High palay buying price makes farmers ecstatic

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    Farm laborers in Ecija haul through “carriada” fresh harvest of palay to be brought along the main road where buyers are waiting. The buying price for fresh harvest is an all-time high of P20-P21 per cavan while it is P24-P25 for the dried grains.

    PHOTO BY ELMO ROQUE

    CABANATUAN CITY – For the first time, farmers in Nueva Ecija, and other parts of Luzon, are “ecstatic” due to the record-high buying price of palay offered by rice millers and traders.

    “Our current buying price is P24 to P25 a kilogram for dry palay and P20 to P21 for the fresh harvest,” Edgardo Alfonso, president of the San Jose City Rice Millers Association (SJCRMA), said in an interview.

    San Jose City is where 26 rice millers are. They buy palay in different towns of Nueva Ecija up to Isabela and nearby provinces for their milling needs. They distribute the milled rice particularly in the Metro Manila area and Southern Luzon provinces.

    “I have not seen anything like this before. It has something to do with the rice millers and traders elsewhere competing to buy as many volumes of palay as they can,’’ he said. “The forces beyond our control dictated it,” he added.

    In Aurora province the buying price of the unhusked rice went up to P28 a kilogram early this month, according to reports. Up north, however, the price offered by the rice millers and traders was much less because of the hauling cost.

    Last year, the buying price offered by the buyers for dried palay was P18 to P20 with the fresh harvest going down to P12 during the peak season. (The moisture content of the palay ideal for milling is 14 per cent. The fresh harvest, which is usually at 22 to 27 percent, or more depending on the weather condition, is dried using solar or mechanical drying facilities.)

    “I don’t think there will be a big reduction in the buying price (of palay) even during the peak of the harvesting season which will start next month,” Alfonso said. At P25 per kilogram, a 50 kg.- sack of palay fetches P1,150 which is higher than the P850 purchase price of the National Food Authority (NFA).

    “This is really good,” one farmer who was able to sell his palay at P25 per kilogram said in Tagalog. “With my harvest of 150 cavans per hectare and total expenses for inputs, harvesting, threshing, hauling and drying cost, I netted about P70,000 which doubled my usual margin of profit,” he said.

    But Alfonso warned that this high palay buying price which is “very, very good for the farmer who had been complaining all along of the low margin of profit for their toil because of the low-buying price of palay,” will have its bad effect for the consumers.

    “At the current buying price of palay, the cost of milled rice will be no less than P42 per kilogram. It will be higher during the lean months,” he said. He said most everybody who buys rice, which is about 90 percent of the rice eating population, will be affected.

    Even the farmers and farm laborers will be tempted to sell all their harvest and resort to buying cheap rice like that being sold by the National Food Authority (NFA), he added. Alfonso said the “thin supply” of rice in the market was reason enough for the rice mill owners and traders to offer high buying price of palay in order to purchase as much as they can to supply the needs of their usual market or clients.

    Among those he pointed out is the fact that production areas are not increasing but decreasing, the demand for rice is getting higher because of the increasing number of rice consumers, thin supply of imported rice, and, in a way, because there was not much private importation or that smuggled rice available in the market has been lowered.

    Of the last reason, he hastened to add that it is a laudable achievement (by the government) but the “replacement” for it should have been anticipated by the government officials concerned like those in the Department of Agriculture and NFA.

    Alfonso said that there will be howls and cries because of the high cost milled rice, but definitely the rice millers and traders would not be selling their rice supply even at its break-even cost.

    “We don’t want to go bankrupt,” he said.

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