Palay farm gate rates are sinking. “The country’s rice farmers are currently suffering from palay rates that have sunk below their average production cost because of tight competition from more affordable imported rice,” reports Inquirer.net. This comes on the heels of the implementation of the Rice Liberalization Law, which has “deregulated rice trade” by allowing private firms to “to import rice stocks without limit so long as they secure sanitary and phytosanitary permits from the Bureau of Plant Industry (BPI).” This has meant that rice traders have been opting to sell imported rice rather than local, as they are now easier to get.
There have been measures adopted to alleviate the effects of the law on local farmers. Last August, the Department of Agriculture (DA) offered a P1.5 billion loan fund to aid in the “immediate relief to rice farmers affected by the reduction or loss of their farm income [and] to help rice farmers regain their capacity to continue their production.”
It doesn’t seem to be enough, however. The DA just announced that the average farm-gate price of unhusked rice has dropped record lows, dropping to P12 to P14 per kilo from last year’s P20. According to a Pangasinan rice farmer, “the current price [is] barely enough to cover the high cost of pesticides and expensive manual labor.” It’s even harder for farmers in the reason to harvest their rice, as they don’t have modern drying facilities to dry their wet produce.
(Read: Instead of penalizing farmers, why not provide drying facilities?)
Consumer group Samahan at Ugnayan ng mga Konsyumer para sa Ikauunlad ng Bayan (SUKI) noted that while this is happening, the country is experiencing a proliferation of cheaper, low quality imported rice. The more affordable rice are “of very low quality or go stale easily,” they said, adding, “We also dread the fact that what should be our source of cheap, better-quality rice, which is our local produce, is threatened due to government’s rice import liberalization policy.” They also revealed that “farmers from Isabela, Tarlac, Nueva Ecija, Laguna, Sorsogon and Bukidnon claimed that farm gate palay prices have fallen to as low as P7 per kilo.”
One way to mitigate this situation is to increase the tariff on imported rice to encourage traders to buy local produce instead, as one columnist suggests. “At today’s 35 percent tariff, the landed cost with arrastre and storage is P24 a kilo. With an additional P6 for transport and profit margins, the retailer can sell profitably at P30,” adding that, “if the farm gate price is above P12, the trader would rather get the cheaper imported rice. If the farmer has a production cost of P12.42 and he sells at P12, he will lose and stop planting.”
To the credit of the DA, they are still looking into ways to help our local farmers, especially during the coming harvest season. Hopefully, it wouldn’t be too late.
Featured photo courtesy of Inquirer.net.
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