Rice output seen recovering as farmgate prices improve

A rebound in farmgate palay prices is expected to support a recovery in local rice production, with agriculture officials pointing to stronger planting prospects and a more stable supply in the coming seasons.

Agriculture Secretary Francisco P. Tiu Laurel Jr. said Thursday that higher buying prices are restoring farmer confidence after a period of weak returns that discouraged planting.

“Many farmers decided not to plant last season because they were still recovering from losses when palay prices were between P10 and P12 per kilo,” he said. 

“This harvest season, we are seeing prices improve to P22 to P27 per kilo, and we hope this continues so farmers are encouraged to plant more for the next season.”

Palay prices had previously fallen below production costs, dropping to as low as P8 per kilo in some areas and averaging around P10 to P12 per kilo in many markets, prompting farmers to scale back or delay planting.

The recovery has been partly attributed to supply-tightening measures, including a temporary restriction on rice imports between September and December, which helped stabilize domestic market conditions.

To sustain growth, the DA said it will support recovery with fertilizer and fuel subsidies, faster distribution of inputs, and expanded financial assistance. Likewise, it is studying a voucher system to improve access to inputs and promote the use of organic fertilizers to lower production costs.

The Philippine Statistics Authority reported that first-quarter palay output fell to 4.4 million metric tons from 4.69 million metric tons a year earlier, largely due to planting decisions made during the period of weak prices and adverse weather.

Much of the first-quarter harvest was planted late last year, when typhoons brought heavy rains and flooding to major rice-producing regions, including Cagayan Valley and Western Visayas, damaging crops and limiting yields.

Irrigation constraints also weighed on output, particularly damage affecting about 37,000 hectares served by the National Irrigation Administration’s Upper Pampanga River Integrated Irrigation System.