Palay prices up 18.1% in October

THE average farmgate price of palay (unmilled rice) increased by 18.1 percent to P20.60 per kilogram (kg) in October, the Philippine Statistics Authority (PSA) said on Monday.

Latest PSA data showed that the latest average price of palay is higher than the P17.44 per kg average recorded in October 2022.

Likewise, the P20.60 per kg is 3.4 percent higher than the P19.91 per kg average in September 2023.

The PSA said that 15 regions, except the National Capital Region, continued to record positive year-on-year growth rates in the average farmgate prices of palay in October this year.

Only the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) posted a decrease in farmgate prices by 4.0 percent to P17.36 per kg.

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Northern Mindanao (Region 10) registered the highest annual increase of 29.2 percent, and the highest palay farmgate price average of P23.56 per kg. The Ilocos Region (Region 1) and Davao Region (Region 11) followed with an average price of P22.92 per kg and P21.73 per kg of palay, respectively.

On a monthly basis, 10 regions recorded increases in the average farmgate prices of palay, while five regions posted decreases during the month.

Meanwhile, Cagayan Valley (Region 2) remained at its September 2023 average farmgate price of P21.30 per kg. The highest month-on-month growth was registered in BARMM at 30.5 percent.

The highest monthly decrease was posted in Caraga (Region 13) at 3.8 percent.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp., attributed the higher prices of palay to costly farm inputs, adding these also reflected higher world rice prices.

“Higher palay prices year on year may partly reflect higher input costs, as well as the upward adjustments made by local authorities to support farmers in terms of higher incomes,” he said.

Ricafort also cited the risk of El Niño that could reduce rainfall and affect palay output and, in turn, could lead to some pick up in rice prices as seen last October.

“Though there is no large storm damage in October 2023, some storm damage from late July 2023 to early September 2023 could have led to some adverse spillover effects into October 2023 in terms of some reduction in palay output,” said Ricafort.