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‘Low prices causing low rice production: Hike palay prices, traders urge gov’t
By Dexter A See

BAGUIO CITY – Despite threats aired to reduce their allocations because of their exposè about the alleged diversion of cheap rice to rice-producing areas, rice traders here urged the national government to increase the buying price of palay. They said higher palay prices would serve as incentives for farmers to continue and increase production of the staple.

Instead of wasting billions of pesos in taxpayer’s money for allegedly overpriced imported rice, traders and retailers here said government funds should be used to jack up palay prices.

This could prevent farmers from selling their lands to developers who convert the farms into industrial or residential areas, they said.

If the government spends $ 1,200 or P45,900 per metric ton of rice, they added, the amount saved could be used instead to increase the buying price of palay from P17 to P20 per kilo. The increase in price would help the farmers cope with the rising prices of basic commodities.

In such case, 80 kilos of palay, which yield 50 kilos or one cavan of rice, would cost P1,600, way above the prevailing 17 per-kilo buying price of palay.

Aside from increasing the buying price of palay, the traders and retailers cited the urgent need to flood the Metro Manila markets with sufficient rice supply to help reduce the skyrocketing prices of commercial rice in urban centers.

The traders said that Region II, particularly Isabela, has abundant supply of rice but they are puzzled why the stock is not being released to Metro Manila outlets, noting the big demand during this so-called "lean months."

While admitting that there is a P2-P3 reduction in the prices of commercial rice, they said the decline in rice prices is still very low because the supposed regular price is from P28 to P30 per kilo. The national government had been bragging about the existence of sufficient rice supply in the country brought about by the arrival of hundreds of tons of imported rice, but it appears that the imported rice could not stabilize the prices in the markets because of the failure of concerned government agencies to flood the markets, particularly those in urban centers, with the stock in rice-producing areas.

They asked the Department of Agriculture and the National Food Authority not to limit their rice allocation as sanction for exposing the diversion of rice, saying the reduced allocation would adversely affect the poor residents.

Instead, the DA and NFA should act decisively by reducing the excessive rice prices brought about by the limited supply. This could be done by releasing the tons of rice kept in warehouses in Region II, the said.