Author: DA Press Office

Average farmgate prices of palay climbed steadily in the months following President Ferdinand Marcos Jr.’s decision to suspend rice importation from September to December, reflecting tighter domestic supply conditions and improved bargaining power for farmers.

This recovery follows several years of changing market conditions. Based on data from the Philippine Statistics Authority (PSA), palay farmgate prices remained strong in 2023 and increased further during the 2023–2024 Dry Season, when dry palay prices exceeded ₱22 per kilo and peaked above ₱25 per kilo in some months.

However, following the reduction of rice tariffs from 35 percent to 15 percent in late 2024, rice import volumes increased significantly, resulting in domestic oversupply. This placed downward pressure on farmgate prices, which declined in 2025 and fell to around ₱14 to ₱16 per kilo in several months. Prices reached a low of about ₱15.80 per kilo in September 2025 before starting to recover toward the end of the year. By December 2025, average prices had rebounded to around ₱18 per kilo.

Monitoring data from the National Food Authority (NFA) show that traders’ average buying prices for fresh palay opened September at ₱14.43 per kilo. Prices softened to a low of ₱13.38 by October 10 as peak harvest volumes entered the market, briefly weighing on farmgate returns. By October 30, however, fresh palay had begun to recover to ₱14.02 per kilo.

A more decisive uptrend took shape in November and accelerated through December and January, indicating that the four month import pause began reshaping market expectations.

Fresh palay prices increased from ₱14.06 on November 6 to ₱15.58 by December 23. The rally extended into the new year, climbing to ₱15.81 on January 6 and rising further to ₱17.47 by January 22. By January 30, traders were paying ₱18.42 per kilo, roughly 28 percent higher than early September levels.

Prior to the import suspension, falling palay prices had resulted in financial losses for farmers and weakened incentives for planting and production.

Dry palay prices also posted a sustained improvement. From ₱17.67 per kilo at the start of September, prices dipped slightly to ₱17.21 in early October before entering a steady climb. By December 23, dry palay had reached ₱19.89.

The upward momentum continued in January, reaching ₱20.65 on January 22 and ₱21.52 by month end, up nearly 22 percent from September.

Agriculture Secretary Francisco P. Tiu Laurel Jr. said the price rebound highlights the effects of excessive rice importation in previous years.

“In 2024, total rice imports surged to 4.8 million metric tons, about 1 million to 1.2 million metric tons more than what the country actually needs,” Tiu Laurel said. “Excess importation undermines the profitability of rice farming by depressing palay prices at harvest time and discouraging production.”

He stressed that the administration’s objective is calibration, not protectionism.

“Striking the right balance ensures gains for everyone in the rice value chain—farmers, traders, millers, and consumers—while safeguarding national food security,” he added. “We must align imports with real supply gaps, not overshoot them.”

The data indicate that even a temporary pause in imports can influence trader behavior by tightening competition for domestic stocks as imported supply declines. While higher farmgate prices provide much needed relief to producers, policymakers must carefully manage buffer stocks and future import timing to prevent renewed inflationary pressure on retail rice.

“The increase in palay prices with very little price support from the NFA is a very welcome development, even if it will mean higher palay procurement costs,” said NFA Administrator Larry Lacson.

Whether the current upswing marks a long term market correction or a cyclical adjustment will depend on how closely future import volumes are aligned with actual domestic demand in the months ahead. 

(By DA – OSEC Comms & file photo by AFID)

Published Date: February 13, 2026