A GROUP of rural workers’ advocates urged the Philippine government to impose a floor price for palay (unmilled rice) to arrest the decline in retail prices of the staple grain.
The Federation of Free Farmers (FFF) on Thursday, April 10, proposed the implementation of a minimum price of P20 per kilo of palay.
The FFF wants this to arrest the “severe drops” in farm-gate prices caused by the influx of imported rice and other factors.
The Department of Agriculture (DA) said it is open to the idea, although it recognized that palay’s farm-gate price — or the price received by farmers for selling their produce directly from the farm — is a complex issue to navigate.
In a briefing on Thursday, Agriculture Assistant Secretary Arnel de Mesa said Agriculture Secretary Francisco Tiu Laurel Jr. is studying this proposal as one way of helping farmers.
The proposed P20 per kilo floor price is “reasonable,” he told reporters.
Sought for additional information, the FFF said the group made the suggestion based on the assumption that the production cost is P15 per kilo and the national average is 4.1 metric tons per hectare.
This would translate to farmers earning P5 a kilo and net proceeds of P3,417 per month for every hectare cultivated to support their families.
The FFF made this appeal to the government as buying prices for freshly harvested palay have reportedly dropped to as low as P12 to P14 per kilo in many parts of the Philippines.
“At this rate, many farmers will end up with losses, while more efficient producers will net only about P16,000 per hectare, or P2,700 per month for six months’ work,” FFF chair Leonardo Montemayor said.
The former agriculture secretary added: “If the government has imposed a maximum suggested retail price or MSRP for consumers, it should also protect farmers by requiring traders to buy palay from them at a minimum price.”
Montemayor said this scheme would help local farmers command higher selling prices for their palay harvests as the National Food Authority could only purchase 4 to 5 percent of the overall harvests due to funding, storage, and other constraints.
At the same time, the group said most farmers are forced to sell their palay to private traders since they cannot comply with the grains agency’s drying and quality standards.
“The [floor price] could complement a proposed seasonal tariff arrangement, wherein duties on rice imports will be temporarily raised during harvest periods and returned to normal levels after farmers harvest their crops,” he added.
According to Montemayor, this practice is adopted in other nations, either managed by government agencies or in compliance with laws requiring traders to purchase farm products at a minimum price at the point of first sale. (Jordeene Lagare © Philippine Daily Inquirer)
