Rice prices continue to decline

MANILA, Philippines — Prices of Filipinos’ main staple remained on the downward trend with consumers saving more and farmers earning less following the influx of imported rice.

Based on latest data from the Philippine Statistics Authority (PSA), rice prices declined for more than eight months now after the Philippines opened its rice industry to more private sector imports.

In its regular update on palay, rice and corn prices, PSA said the average wholesale price of well-milled rice was P37.85 per kilogram as of the second week of October, 16 percent lower than the same period a year ago. Average retail price also decreased by 14.3 percent to P41.89 per kilo.

Meanwhile, the wholesale price of regular-milled rice was P33.70 per kilo, down 20 percent while the average retail price was P37.22 a kilo.

While consumers are benefitting from the opening up of the market, local farmers are suffering from declining palay farm gate prices.

The average farm gate price of palay is nowhere near recovery at P15.53, down by 0.2 percent on a weekly basis.  This also represents a 26.9 percent drop from the P21.23 per kilo last year prior to the passage of the Rice Liberalization law.

It is also lower than the P19.40 per kilo last March when the law took effect.

The lower farm gate price was attributed to the increased local harvest, exacerbated by imports flooding the commercial market.

Total rice inventory stood at 1.84 million metric tons (MT) as of September, up 13.7 percent from last year’s 1.6 million MT.  This is 14 percent lower than the previous month’s 2.13 million MT.

Under the rice tariffication law, quantitative restrictions on rice importation are lifted and private traders are allowed to import the commodity from countries of their choice.

The rice tariffication law replaced the government’s quantitative restrictions on importation of the staple with a 35 percent tariff.

It also created the Rice Competitiveness Enhancement Fund, a special rice buffer fund with an initial P10-billion annual fund to ensure competitiveness of rice production.