In the Philippines' rice granary, farmers endure falling grain prices

Jessica Fenol, ABS-CBN News

Posted at Oct 14 2019 05:40 AM | Updated as of Oct 14 2019 06:17 AM

Workers take advantage of the good weather to harvest and transport palay crops along a highway in Guimba, Nueva Ecija. Some farmers claimed prices of palay dropped to as low as P7 per kilo after the rice tariffication law took effect in March. Sept. 13, 2019. Jonathan Cellona, ABS-CBN News

STA. ROSA, Nueva Ecija -- Rice farmer Reynaldo Gonzales casts a worried gaze over his crops, praying they survive heavy rains before the harvest so they can be sold before prices go down further.

In the Philippines' rice-growing towns north of Manila, farmers like Gonzales are grappling with a new tariff-based regime to manage the supply of the staple that caused prices to plummet, and with it, their income.

Gonzales said he sold his first palay harvest for 2019 at P10 to P12 per kilo, halved roughly from 2018 prices of P19 to P20 per kilo. This forced the widower to take out a P20,000 loan to send 3 of his 6 children to school.

"Ang dinadaanan namin ngayon mahirap talaga. Pantawid gutom na lang dahil halos kalahati ang nawala," said Gonzales, who grows upo or bottle gourd to augment his income.

(It's very difficult, what we're going through. We barely have enough for food because our income is halved.)

"Pag nag ani, ibabayad mo lang ‘yun para makautang ka ulit," he said, adding the state grains agency has been buying rough rice from farmers at a low price.

(Whatever we earn from the harvest, we use to pay off loans so we can borrow again.)

Staring at his 2-hectare field, Gonzales told ABS-CBN News: "Wag sana bumagyo dahil maiipa ‘yan. (I hope there's no typhoon. Otherwise, this is as good as rice husk.)

Reynaldo Gonzales takes shelter in his home in the middle of a rice field in Sta. Rosa, Nueva Ecija. He hopes to sell his harvest at a higher price in order to pay off his debts. Sept. 12, 2019. Jonathan Cellona, ABS-CBN News

The government switched to rice tariffs in place of import quotas to manage supply and tame consumer price spikes. Inflation peaked to near-10 year highs in September and October at 6.7 percent in 2018 mainly due to the rise in food prices.

CALL FOR HELP

Some groups in Central Luzon opposed the rice tariffs, which they said could hurt the income of local palay farmers.

Reynaldo with his youngest son, 6-year-old Ian, who he hopes to man the fields in the future. Jonathan Cellona, ABS-CBN News

Six months after the law took effect, farm-gate prices of palay dropped by 30.1 percent to P16.18 per kilo from P23.14 per kilo compared to the same period last year, September data from the Philippine Statistics Authority (PSA) showed. 

Farmers in Nueva Ecija earlier claimed it dropped to as low as P7 per kilo.

Landowners use heavy machines to harvest the crops as carabaos transport sacks of rice out of the fields. Sept. 13, 2019. Jonathan Cellona, ABS-CBN News

The law's Implementing Rules and Regulations (IRR) mandated the creation of a P10-billion Rice Competitiveness Enhancement Fund (RCEF) to help improve the "profitability" of affected farmers. 

Fifty percent of the fund is allocated for machinery and equipment, 30 percent for seed development, 10 percent for training, and 10 percent for loans with minimal interest, under the IRR.

The Department of Agriculture also proposed P15,000 interest-free cash loans per qualified borrower with no interest for farmers affected by the influx of imported rice. 

But cash loans and provisions for machinery are measures that were available before, 42-year-old farmer Ignacio Ortiz said. What the government needs to do is to suspend the law that is "killing" the livelihood of many, said Ortiz, who chairs the Alyansa ng mga Magbubukid sa Gitnang Luzon – Nueva Ecija chapter.

Ignacio Ortiz prepares for a rice forum in Guimba, Nueva Ecija. Sept. 13, 2019. Jonathan Cellona, ABS-CBN News

RICE COUNTRY

At least 10 million Filipinos are engaged in the agriculture sector or 24.30 percent of the country's total national employment, data from the PSA showed.

Planting palay has long been uneconomical due to other factors such as the lack of modern machinery and irrigation. Rice tariffication made it worse, Ortiz said. 

Ortiz spends about P60,000 for a 1.2-hectare rented farm lot, covering seeds, labor, irrigation, pesticides, fertilizer, machinery rental and land lease, among others. 

He produced 4,032 kilos of palay earlier this year which was sold for P12 per kilo or for a total of P48,384. This left him with a P12,116 deficit, when he would otherwise earn as much as P24,000. 

“Ngayon pa lang baon na kami sa pagkakautang at wala na kami aasahan na ipapambayad. Patay talaga. Kung hindi tataas ang presyo, hindi na namin kayang mabuhay ng tatlong taon pa,” Ortiz said.

(We are deep in debt and have nowhere to run to pay them off. We're dead. If the prices don't go up soon, we can't last for another 3 years.)

Ignacio Ortiz shows a paper detailing the total costs of planting palay. Sept. 13, 2019. Jonathan Cellona, ABS-CBN News

Ortiz survives by helping install deep wells during his free time. He feeds his family with vegetables grown in rice fields and by buying the cheapest kind of NFA rice available for P25 to P27.

"Napakasakit tanggapin ng isang magsasaka, na ikaw ang nagtanim ng pagkain, ikaw ang walang makain. Talagang tumutulo ang luha ko," Ortiz said. 

(It's painful for a farmer, to plant the seeds to feed everyone then have nothing to eat. I am brought to tears.)

On bad days, Ignacio Ortiz settles for the cheapest NFA rice available for P25 or P27 pesos. Jonathan Cellona, ABS-CBN News

Third-generation farmer Leogardo Ortiz, 48, works overtime as plumber and construction worker to send his 5 children to school, after tropical storm Nimfa destroyed his crops. He wanted to send his children to school so they wouldn't suffer the same fate.

Leo Ortiz wades through the flood to check his crops in Licab, Nueva Ecija. Photo by: Leo Ortiz
Crops destroyed by floods after tropical storm Nimfa hit parts of Central Luzon in September. Photo: Leo Ortiz

Floods wiped out his rice fields in Licab, Nueva Ecija last September. Licab is a known catch-basin during bad weather. Flooding was aggravated by a defective dike, the younger Ortiz said. 

"Sa ngayon sana ang pangarap ko mapag-aral ko sila para hindi na nila maranasan ang hirap na minana ko. Gusto ko makapagaral mga anak ko para hindi lang sila sa pagsasaka. Kung nakapagaral hindi na sila ang magsasaka," Ortiz said.

(My dream is to send my children to school so they will not inherit this kind of poverty. I want them to finish their studies so they are not limited to farming.)

NO FARMER SPARED

Alighting from their mid-range pick-up vehicle, husband and wife Roman and Magdalena Facub attended a rice forum in Brgy. Naglabrahan in Guimba, Nueva Ecija, along with at least a hundred others. 

Mr. and Mrs Roman and Magdalena Facub are rethinking their plans to plant palay next season after farm-gate prices of rough rice dropped, cutting their earnings by more than half. Sept. 13, 2019. Jonathan Cellona, ABS-CBN News

The couple, who has been hiring farmers to plant palay in their 10-hectare property since 1985, might stop funding the business next season after earnings were cut by up to 80 percent, Facub said.

"Wala talagang nangyayari, kulang na kulang ang kinikita namin, may nagaaral, college, pang araw-araw allowance," Magdalena said.

(Nothing will become of us if we don't earn enough. It's just enough for day-to-day allowance if someone is in college.)

The law that threatens their business is also detrimental to the livelihood of manual laborers that get paid by the day, Magdalena said.

Emily Reyno, who earns P100 a day to tend to farm lands, now has to resort to doing laundry, as landowners hire less people to look after their rice fields.

The worst feeling was eating porridge made from cheap and almost inedible rice to get by, when money scarce, the mother of 4 said.

"May amoy pa po. Talagang nakakiyak po talaga, parang hindi mo kayang lunukin. Minsan nakatingala ka na lang, saan ka kukuha ng pagkain mo," the teary-eyed 59-year-old farm worker said, adding that some manual work was also replaced by heavy machineries. 

(It had a smell. I cried because I couldn't swallow it. Sometimes, you just look up and think about where you'll get food.)

RICE PRICE DROPS WITH "GREAT SUPPLY"

True to its mandate, the rice tariffication law (RTL) "lowered the prices" of rice compared to last year, Trade Secretary Ramon Lopez told ABS-CBN News.

"The RTL has lowered the prices of rice compared to last year's level, with greater supply in the market. There may be no need for SRP [Suggested Retail Price] for now, because the DA [Department of Agriculture] said they will bring the NFA [National Food Authority] rice inventory which will bring down further rice prices," Lopez said. 

The average price of regular milled rice “plunged” 17.8 percent annually to P37.79 per kilo in the last week of September from P45.96 kilo in the same week last year, data from the PSA showed.

Well-milled rice went down 14.2 percent this year to P42.27 per kilo from P49.27 per kilo last year, data showed. 

Rice stock also rose by 40.3 percent in August due to higher importation of rice, the National Economic and Development Authority (NEDA) said. 

Rice inflation decelerated to -8.9 percent in September, the lowest since 1995, from 10.4 percent in the same period last year, government data showed. Overall inflation eased to 0.9 percent for in September. 

Data by the Philippine Statistics Authority. Processed by ABS-CBN Data Analytics.

Rice tariffication contributed to the decline in food prices, Socioeconomic Planning Secretary Ernesto Pernia earlier said.

"We see the rice tariffication law continuing to help pull down overall inflation in the near term as it continues to help improve rice stock inventory of the country," Pernia said in a statement.

EQUALIZER

The government should intervene to "equalize" the interests of consumers, who want cheaper rice, and local farmers who want to earn fairly, Senator Francis Pangilinan earlier said.

Pangilinan filed a resolution urging state agencies to release financial assistance to palay farmers, including the remaining allowance from the RCEF and the P9.19 billion tariff revenue collected from rice importation from March to August 2019.

Palay farmers have lost P60 billion since the measure was imposed, the resolution said. 

Without intervention, the current generation of farmers with an average age of 58 years old, could abandon farming, leading to the decline of the local rice sector and the country's food security, the resolution said, citing a study by the Philippine Institute of Development Studies (PIDS). 

Both Ortiz and Gonzales fear for the their families and the future of farming in the country. 

"Nagiisip na kami ng ibang mapapagkakitaan. Hindi ko alam 'yung ibang trabaho. Baka sakali, 'pag wala na talaga, mag-construction na lang ako," Gonzales said.

(I'm thinking of other sources of livelihood. I don't know any other job. Maybe I'll shift to construction)

"Paano na ang susunod na henerasyon ng magsasaka kung hindi tataas ang presyo ng palay? Baka wala na," Ortiz said.

(What will become of the next generation of farmers if palay prices don't go up?)