Marcos directs DA to set floor price for palay amid low farmgate prices

President Ferdinand "Bongbong" Marcos Jr. on Saturday issued an executive order (EO) directing the Department of Agriculture (DA) to establish a floor price for palay (unhusked rice) and introduce trigger mechanisms for its implementation to protect Filipino farmers from unfairly low farmgate prices.

In a news release, the Presidential Communications Office (PCO) said Marcos signed EO 100 on Saturday, October 25, tasking the DA to determine and regularly adjust the floor price for palay, "taking into account production costs, market conditions, and farmers' welfare, while also balancing consumer affordability."

Marcos' order also creates a Steering Committee composed of key government agencies—including the DA, Department of the Interior and Local Government (DILG), Department of Trade and Industry (DTI), Department of Agrarian Reform (DAR), Department of Social Welfare and Development (DSWD), and the National Food Authority (NFA)—to assist in setting and enforcing the floor price.

The PCO said the President's directive aims to stabilize farmgate prices, shield farmers from market volatility, and support national food security, particularly during harvest seasons when prices tend to fall due to oversupply or unfair trading practices.

In issuing EO 100, Marcos said "the absence of a just and equitable floor price for palay exposes farmers' vulnerability to volatile market prices, particularly during the peak of harvest seasons when farmgate prices often drop due to oversupply, weather-related impacts, or unfair trading practices, thereby undermining their livelihood, farm productivity, and long-term agricultural sustainability."

"In view of the rising production costs coupled with climate-induced production risk and the widening profit margin gap between farmgate price and retail prices, the government recognizes the urgent need to guarantee a fair and just return to farmers by setting a floor price that covers production costs and provides reasonable income while ensuring the affordability and stability of rice supply for consumers," Marcos said in his EO 100.

The PCO said the issuance of the order came on the heels of local farmers' organizations concerns that farmgate prices of palay remain "stubbornly low," urging the government to implement a P5-per-kilo support price and to revert tariffs on imported rice. 

The Palace said farmers groups lamented that the import ban has so far failed to lift farmgate prices, which remain between P10 and P12 per kilo in most areas and have dropped to as low as P8 in others.

The EO 100 cited Republic Act 11321 or the "Sagip Saka Act," which mandates the national and local government agencies to directly purchase agricultural and fishery products from accredited farmers and fisherfolk cooperatives and enterprises, provided that such products are necessary in the performance of their respective mandates.

The presidential order also allows government agencies and local government units (LGUs) to use public facilities such as covered courts or multipurpose halls as temporary palay storage sites when warehouses are unavailable, ensuring proper handling and preservation of grains.

"In the absence or insufficiency of available and suitable warehouses for the proper storage of purchased palay, national government agencies (NGAs) and instrumentalities, including government-owned or -controlled corporations (GOCCs) and state universities and colleges (SUCs), and LGUs shall be authorized to use public facilities such as covered courts, multi-purpose halls, gymnasiums and other government owned structures as temporary storage sites, subject to existing laws, rules and regulations," the EO 100 noted.

Moreover, the PCO said the EO provides that violations, such as purchasing palay below the set floor price, will be subject to administrative action. 

The Steering Committee will also conduct regular monitoring of farmgate transactions and submit quarterly reports to the President on the policy's implementation and impact on farmer incomes and rice supply stability, it said. — VDV, GMA Integrated News