High prices in first quarter keep rice farmers profitable, NFA says
RICE FARMERS are estimated to have raised P32 billion from sales of palay, or unmilled rice, in the first quarter, the National Food Authority (NFA) reported yesterday, citing high farmgate prices.
In the first three months of the year, the NFA bought 131,720 bags of rice from farmers nationwide at P17 per kilogram ( kg), for a total of P118.5 million
According to the Philippine Statistics Authority (PSA), the cost of palay production averages P12.00/kg.
Despite NFA’s buying of unmilled rice, farmers took advantage of the high prices offered by private traders ranging at P18.00 — P22.00/kg versus the NFA’s support price of P17.00/kg plus incentives.
NFA Administrator Jason Laureano Y. Aquino said that the NFA buys unmilled rice from farmers in an effort to stabilize rice prices.
“It is the mandate of the NFA to stabilize the price of rice in the market and we know that NFA serves as the benchmark for the price of palay,” he said in a statement yesterday.
“It influences the buying price of private traders to go higher than the support price for them to corner the volume they need. Without NFA as a stabilizer, the traders can dictate the price of palay, short- changing the farmers whenever they can,” Mr. Aquino added.
“We don’t base our performance solely on how much we have procured because we are limited by the government support price of P17.00/ kg. We cannot go beyond that. What is important is that the farmers are enjoying much higher prices from private traders and that is good. The NFA’s presence is meant to stabilize the price of palay, not to directly compete with the traders,” Mr. Aquino said.
The NFA targets purchases of 4.6 million bags (230,367 MT) of palay this year to augment its rice requirement for distribution and buffer stocks.
“At the present government support price of P17.70 — P18/kg of palay, we are still giving the farmers a net profit of at least P285.00 — P300.00 per bag,” he added.