By Madelaine B. Miraflor
Both price and output for the Philippines’ unhusked rice or palay have slid in the first quarter of the year as the country finally moves towards rice tariffication, which would allow the entry of more imported stocks into the local market.
While prices normally go up when the output is down, the case isn’t the same for the first quarter’s deseasonalized palay production. A data from Philippine Statistics Authority (PSA) showed that the deseasonalized palay production for the first three months of the year was 4.69 million metric tons MT, lower by 0.4 percent compared with the fourth quarter of 2018 output of 4.7 million MT.
From 2011 to 2019, the highest deseasonalized palay output for the first quarter was in 2018 at 4.9 million MT and the lowest was in 2016 at 4.2 million MT.
Year on year, this quarter’s performance when deseasonalized was lower by 4.6 percent
For this quarter, the deseasonalized farm gate price of palay also went down by 5.3 percent to P20.07 per kilogram from the previous quarter. However, this was slightly higher than the 2018 first quarter’s level of P20.04 per kilogram.
Retail price for rice also went down by 12 percent to P41.35 per kilogram from the previous quarter. This was a drop of 4.28 percent from the first quarter of 2018.
The wholesale price of rice for the first quarter of 2019, on the other hand, was now at P45.06 per kilogram. This was higher by 2.8 percent than the 2018 fourth quarter’s price of P43.84 per kilogram.
Likewise, it rose by 11.2 percent from the previous year’s level of P40.51 per kilogram.
The price of palay normally goes up when the output is down because it means the supply will tighten. But with Rice Tariffication Law, the local market is now expected to see a surge in the supply of cheaper, imported rice.