The Federation of Free Farmers (FFF) asked the government to implement a minimum palay buying price (MPBP) to protect farmers from drastic declines in farmgate prices caused by excessive rice imports and other external factors.
FFF chairman Leonardo Montemayor said palay prices fell to as low as P12 to 14 per kilogram in many areas. “At these levels, many farmers are incurring losses. Even the more efficient producers earn only about P16,000 per hectare, which translates to roughly P2,700 per month for six months of labor,” he said.
Montemayor said that as the government imposes a maximum suggested retail price (MSRP) to protect consumers, it should also safeguard farmers by requiring traders to purchase palay at a minimum set price.
He said a price floor is necessary because the National Food Authority (NFA) currently buys only 4 percent to 5 percent of the total harvest due to limitations in funding, storage capacity and other operational constraints.
He said many farmers are unable to meet the NFA’s drying and quality standards, leaving them reliant on private traders.
Montemayor suggested that the MPBP work alongside a proposed seasonal tariff mechanism, under which rice import duties would be temporarily increased during local harvest periods and then lowered afterward.
“In the same way that we establish minimum wages for workers, we must ensure that farmers receive fair and adequate compensation for their essential role in feeding the nation,” he said.
He also noted that similar floor price programs are already being implemented in various countries, either through government-run systems or legal mandates that require traders to purchase agricultural products at minimum prices at the point of first sale.
