Palay prices climb after rice import suspension

Average farmgate prices of palay rose steadily following President Ferdinand Marcos Jr.’s decision to suspend rice imports from September to December 2025, reflecting tighter domestic supply and stronger bargaining power for farmers.

Data from the Philippine Statistics Authority showed that palay prices remained firm in 2023 and during the 2023-2024 dry season, with dry palay selling for over P22 per kilo and occasionally exceeding P25.

Prices began to decline in 2025 after rice tariffs were reduced from 35 percent to 15 percent, triggering a surge in imports and domestic oversupply. Farmgate prices fell to between P14 and P16 per kilo in several months, hitting a low of P15.80 in September 2025.

Monitoring by the National Food Authority showed that traders’ average buying prices for fresh palay started at P14.43 per kilo in early September, dipped to P13.38 by 10 October due to peak harvests, and recovered to P14.02 by 30 October.

The rebound accelerated during the import suspension. Fresh palay prices increased from P14.06 on 6 November to P15.58 by 23 December, climbing further to P18.42 per kilo by 30 January, roughly 28 percent higher than early September levels.

Dry palay prices followed a similar trend, rising from P17.67 per kilo in September to P21.52 by late January, a nearly 22 percent increase.

Agriculture Secretary Francisco P. Tiu Laurel Jr. said the trend underscores the impact of excessive rice imports in previous years.

“In 2024, total rice imports surged to 4.8 million metric tons, about 1 million to 1.2 million metric tons more than what the country actually needs,” he said. “Excess importation undermines the profitability of rice farming by depressing palay prices at harvest time and discouraging production.”

He stressed that the administration’s objective is to properly calibrate imports rather than adopt protectionist policies.

“Striking the right balance ensures gains for everyone in the rice value chain—farmers, traders, millers, and consumers—while safeguarding national food security. We must align imports with real supply gaps, not overshoot them,” he said.

Larry Lacson said the increase in palay prices, achieved with minimal intervention from the NFA, offers much-needed relief to farmers, even as procurement costs rise.

Despite the recent upswing, experts said the sustainability of higher prices will depend on careful management of imports, buffer stocks and alignment with domestic demand to avoid renewed inflationary pressure on retail rice.