Cost of producing palay rose 7% to P14.52 per kilo
Higher farm input and labor costs jacked up the average cost of producing palay or unmilled rice last year, according to industry sources.
The average cost of producing palay stood at P14.52 per kilogram in 2024. This meant a 7.2-percent increase from P13.54 per kg in the previous year, according to data from the Philippine Statistics Authority (PSA).
Among the regions, Central Visayas recorded the highest average production cost at P19.73 per kg. Meanwhile, Eastern Visayas posted the lowest cost at P12.59 per kg.
The PSA said the average cost of palay production in the country on a per-hectare basis reached P59,695, up by 5.7 percent.
Meanwhile, net returns from palay production climbed by 37.04 percent to P36,211 per hectare.
Productivity dip
“The higher cost per kilo in 2024 was due to higher overall costs coupled with a slight decline in yield per hectare,” Federation of Free Farmers national manager Raul Montemayor told the Inquirer on Wednesday.
Roy Kempis, director of Center for Business Innovation at Angeles University Foundation, said labor costs have risen due to a shortage of farm manpower and, to some extent, higher minimum wages for agricultural workers, particularly for transplanting, or the transfer of plants from one location to another.
“International supply continues to be affected by geopolitical events like the Ukrainian-Russian war putting some pressure on the landed cost of imported fertilizer,” Kempis told the Inquirer.
Ukraine and Russia are among the world’s major fertilizer suppliers.
Kempis also said the operators of combine harvesters, machines used to automate the harvesting process, now charge an outright fee equivalent to 10 percent of the harvest because of increasing fuel prices.
“But I have misgivings about PSA data because I think a lot of their figures are derived or extrapolated instead of generated from actual field surveys,” Montemayor said.
