The National Food Authority (NFA) on Thursday said Filipino rice farmers earned around P32 billion due to the high farm-gate price of palay in the first quarter of the year.
The NFA said farmers who sold their palay to the agency at P850 to P900 per bag netted at least P39.5 million, while those who sold to traders at an average of P990 per bag earned an estimated P390 per bag or a total of P31.93 billion.
The food agency said it made use of Philippine Statistics Authority data, which pegged the production cost of palay at P12 per kilogram, in computing farmers’ earnings.
“The NFA must be credited for influencing the buying price of palay traders, which benefited the farmers. We know that the NFA serves as the benchmark for the price of palay,” NFA Administrator Jason Laureano Y. Aquino said in a statement.
“Without [the] NFA as a stabilizer, the traders can dictate the price of palay, short-changing the farmers whenever they can,” Aquino added.
The NFA was able to purchase 131,720 bags from farmers nationwide at the government support price of P17 per kg plus incentives of P0.70 to P1 per kg for P118.5 million. The remaining harvest for the period was sold by farmers to private traders at higher prices averaging P19.80 to kg.
Aquino noted even with the NFA’s intensified palay buying activities and incentives, farmers took advantage of the high prices offered by private traders ranging at P18 to P22 per kg versus the NFA’s support price of P17 per kg plus incentives.
The NFA had targeted to buy 4.6 million bags, or 230,367 metric tons (MT) of palay this year, to augment its rice requirement for distribution and buffer stocking.
“We don’t base our performance solely on how much we have procured, because we are limited by the government support price of P17 per kg. What is important is that the farmers are enjoying much higher prices from private traders and that is good,” Aquino said.
Even with the current government support price, Aquino said farmers who sell their palay to the NFA could still net at least P285 to P300 per bag.
The higher price offered by private traders was cited by the NFA as the main reason behind its difficulty in procuring more palay from farmers to beef up its buffer stock.
Earlier, Nationalist People’s Coalition Rep. Arthur Yap of Bohol said the NFA Council (NFAC) should permit the food agency to offer a “summer incentive fee” ranging from P1 to P2 per kg so the NFA could compete with local rice traders.
“If the NFA is not allowed to import, then at least the [NFA] administrator should get an NFAC approval to offer a season-based summer incentive fee of at least P1 per kg so it can buy more local palay,” Yap told the BusinessMirror.
“That amount will at least go to local farmers and allow the NFA to compete with local traders.
The increase should be time-bound just to make the NFA competitive,” the former chief of the Department of Agriculture added.