Following a slight price increase in the previous week, the average farmgate quotation of palay (unmilled rice) dropped in the third week of July, reaching P17.80 per kilo, the Philippine Statistics Authority (PSA) said.
In its weekly update on palay, rice and corn prices, PSA said the latest quotation was 0.1 percent lower than the P17.81 per kilo a week earlier. Likewise, it further dropped by 17.6 percent from P21.59 per kilo in the same period in 2018.
Amid the influx of cheap imported rice following the passsage of the Rice Liberalization Law, there is a need for the country’s economic managers to rethink their theory “that when there is an abundance of supply, prices will drop,” according to outgoing Agriculture Secretary Emmanuel Piñol.
In a statement over the weekend, Piñol said the economists’ gameplan to “let the market forces work” in bringing down the rice price to as low as P27 per kilo with the abundance supply of imported rice simply did not work for the benefit of the farm sector.
“Their simplistic economic theory on market forces missed the reality that in the rice trading business, there are hoarders, market manipulators and the so-called ‘rice cartel,’ an informal cabal of unscrupulous traders who agree to set buying and selling prices,” said Piñol, who was recently assigned to transfer and head the Mindanao Development Authority.
He noted that while the market is flooded with cheap imported rice, the selling price of rice at the retail trade has barely dropped. “In fact, since traders found that importing rice is more profitable, convenient and less risky,
many have opted not to buy locally produced paddy rice, pushing down the price of Filipino farmers’ produce from a high of P20 per kilo last year to as low as P12 to P14 today,” Piñol said.
PSA said the prices of well-milled and regular milled rice posted significant decreases at the wholesale and retail trades.
While the average wholesale price of well-milled rice slightly increased by 0.1 percent to P39.11 per kilo week-on-week, it went down by 7.5 percent from P42.29 per kilo a year ago.
At retail trade, its average price declined 0.1 percent to P42.80 per kilo from a week ago and was lower by 4.9 percent than the P44.90 per kilo a year earlier.
For regular milled rice, the average wholesale price remained at P35.26 per kilo week-on-week. On an annual basis, however, it climbed 9.2 percent. Its retail price, meanwhile, declined by 0.1 percent to P38.35 per kilo and fell by 7 percent from P41.25 per kilo a year ago.
Again, Piñol reiterated the need to review Republic Act 11203, or the “Rice Liberalization Law,” in a bid to address the steep drop on the price of palay produced by local farmers.