Price of palay continues to fall, now 17.4% down
Published Jul 26, 2019 12:00 am
By Madelaine B. Miraflor
The price of palay in the country continues to drop, falling by more than 17 percent year on year as of this month, while the average cost of regular and well milled rice recorded only a single digit drop in percentage.
PSA logo (Photo courtsey of https://psa.gov.ph)
Latest data from Philippine Statistics Authority (PSA) showed that during the first week of July, the farmgate price of palay or unhusked rice declined by 17.3 percent to P17.78 per kilogram (/kg) from P21/50/kg in the same period last year.
From the previous week's level of P17.88/kg, the price only went down by 0.6 percent.
Meanwhile, at the wholesale trade, the average price of well milled rice slightly went down to P39.26/kg or by 0.1 percent during the period from its previous week's level of P39.28/kg. Annually, it also moved downward at a rate of 6.4 percent from its level of P41.93/kg a year ago.
At the retail trade, the average price of well milled rice slightly fell to P42.81/kg or by 0.1 percent compared with its level of P42.86/kg in the previous week. This is a drop of 4.2 percent from the previous year's level of P44.69/kg.
Both prices of at the wholesale and retail trades of regular milled rice are a bit lower, too.
For instance, the wholesale average price of regular milled rice dropped to P35.40/kg or by 0.1 percent this week compared with its week ago level of P35.45/kg. Similarly, it decreased at an annual rate of 8.5 percent from its level in the same week of the previous year of P38.69/kg.
On the average, the retail price of regular milled rice went down to P38.51/kg or by 0.2 percent this week relative to its previous week's level of P38.60/kg. It is a 6.2 percent drop from its level of P41.07/kg in the same week of the previous year.
To protect the farmers from declining palay prices, Philippine Chamber of Agriculture & Food, Inc. (PCAFI) President Danilo Fausto said the government should now implement the safeguard measure under the Rice Tariffication Law, which is to increase the tariff imposed on imported rice.
Based on the Rice Tariffication Law or Republic Act (RA) 11203, importers are allowed to bring in any volume of rice in the Philippines at any time provided they pay a 35 percent tariff based on the declared value of their imports if it's coming from member countries of the Association of Southeast Asian Nations (ASEAN) like Thailand and Vietnam. Outside ASEAN, the tariff rate will be higher at 180 percent.
Under the Section 10 of RA 11203, in order to protect the Philippine rice industry from sudden or extreme price fluctuations, a special safeguard duty on rice shall be imposed in accordance with Safeguard Measures Act.
Agriculture Secretary Emmanuel Piñol said earlier a supply glut could push the tariff rate as high as 180 percent. That, or if the local farmers are already suffering from the oversupply of the staple.
"When you increase the tariff to 180 percent, who else will import? That is technically an import ban," Piñol said previously.
Since the enforcement of RA 11203, palay prices have fallen non-stop. It had so far dropped by 43 percent from P21.00 per kilogram (/kg) in September 2018 to only P12/kg in June 2019.
This, while the farmers have to spend more on production due to higher fuel cost. From an average of P49,745 per hectare in December last year, farmers' production cost now stands at P50,000 per hectare in May.
PSA logo (Photo courtsey of https://psa.gov.ph)
Latest data from Philippine Statistics Authority (PSA) showed that during the first week of July, the farmgate price of palay or unhusked rice declined by 17.3 percent to P17.78 per kilogram (/kg) from P21/50/kg in the same period last year.
From the previous week's level of P17.88/kg, the price only went down by 0.6 percent.
Meanwhile, at the wholesale trade, the average price of well milled rice slightly went down to P39.26/kg or by 0.1 percent during the period from its previous week's level of P39.28/kg. Annually, it also moved downward at a rate of 6.4 percent from its level of P41.93/kg a year ago.
At the retail trade, the average price of well milled rice slightly fell to P42.81/kg or by 0.1 percent compared with its level of P42.86/kg in the previous week. This is a drop of 4.2 percent from the previous year's level of P44.69/kg.
Both prices of at the wholesale and retail trades of regular milled rice are a bit lower, too.
For instance, the wholesale average price of regular milled rice dropped to P35.40/kg or by 0.1 percent this week compared with its week ago level of P35.45/kg. Similarly, it decreased at an annual rate of 8.5 percent from its level in the same week of the previous year of P38.69/kg.
On the average, the retail price of regular milled rice went down to P38.51/kg or by 0.2 percent this week relative to its previous week's level of P38.60/kg. It is a 6.2 percent drop from its level of P41.07/kg in the same week of the previous year.
To protect the farmers from declining palay prices, Philippine Chamber of Agriculture & Food, Inc. (PCAFI) President Danilo Fausto said the government should now implement the safeguard measure under the Rice Tariffication Law, which is to increase the tariff imposed on imported rice.
Based on the Rice Tariffication Law or Republic Act (RA) 11203, importers are allowed to bring in any volume of rice in the Philippines at any time provided they pay a 35 percent tariff based on the declared value of their imports if it's coming from member countries of the Association of Southeast Asian Nations (ASEAN) like Thailand and Vietnam. Outside ASEAN, the tariff rate will be higher at 180 percent.
Under the Section 10 of RA 11203, in order to protect the Philippine rice industry from sudden or extreme price fluctuations, a special safeguard duty on rice shall be imposed in accordance with Safeguard Measures Act.
Agriculture Secretary Emmanuel Piñol said earlier a supply glut could push the tariff rate as high as 180 percent. That, or if the local farmers are already suffering from the oversupply of the staple.
"When you increase the tariff to 180 percent, who else will import? That is technically an import ban," Piñol said previously.
Since the enforcement of RA 11203, palay prices have fallen non-stop. It had so far dropped by 43 percent from P21.00 per kilogram (/kg) in September 2018 to only P12/kg in June 2019.
This, while the farmers have to spend more on production due to higher fuel cost. From an average of P49,745 per hectare in December last year, farmers' production cost now stands at P50,000 per hectare in May.