The High Cost of Planting Rice

 

In this article of Inquirer.net explains why...

http://newsinfo.inquirer.net/inquirerheadlines/nation/view/20080419-131335/Planting-rice-never-fun-ask-Mang-Piring

Planting rice never fun, ask Mang Piring
By Anselmo Roque
Philippine Daily Inquirer
First Posted 01:41:00 04/19/2008

SCIENCE CITY OF MUÑOZ, Philippines--Farmers produce rice with sweat, sacrifice--and loans.

The whole enterprise is a gamble, with nature and a number of other factors coming into play.

Apart from the farmers, millers and traders are likewise vital in the journey of the precious grain from the fields to the dinner tables.

Their stories may help explain to Filipino consumers why the price of rice is soaring these days.

Mang Piring, 58, has been tilling his one-hectare farm in Villa Cuizon for more than 30 years.

Two months before last year's dry-season cropping that started in mid-December, knowing that the rice yield would be more than that in the July-October wet-season cropping, he visited a reputable seed grower's outlet and bought two 40-kilogram bags of inbred rice seeds.

The "registered" seeds cost P40 a kg, so he paid P3,200. (The other seeds commonly used by local farmers, the "certified" variety, sell for P30 a kg.)

According to rice experts, one bag is sufficient for the seedling needs of a one-hectare farm.

But Mang Piring did not want to take chances, so he bought two bags. After all, what if birds or rats feed on the seeds? What if much of the grains do not germinate?

Planting rice...

When irrigation water was released to his farm, Mang Piring contracted his neighbor, who has a hand tractor, to plow, harrow and level a portion of the farm for the seedbeds.

He waited 20-25 days for the seeds to grow, ensuring that the seedlings had enough fertilizer and water and were protected against rats, birds, insects and diseases.

Then he prepared the planting area. It was plowed thrice using the hand tractor at one-week intervals, and then harrowed and leveled.

"Dukit"--or the plowing of planting areas near the small dikes that could not be reached by the hand tractor--was done with the use of a carabao and a plow.

As these activities were completed, Mang Piring cleaned and fortified the dikes, making sure that no irrigation water would seep through and that no rats would be able to burrow their way inside.

...Is never fun

When everything was ready, Mang Piring called the "mambubunot ng punla" to uproot, bundle and then distribute the seedlings in the various planting areas.

Early the next day, 25 contracted "manananim" started transplanting rice in the farm.

Mang Piring heaved a sigh of relief when the rice planters left. Half of his work was done.

But the next half was no less arduous.

It included controlling the golden apple snails (kuhol) in the paddies, applying fertilizers, alternately irrigating and draining the field, weeding, and installing traps or baiting stations to control the rats.

Add to that pest management, inspection of the plants' leaves and other parts for possible pest and disease infection, and continuous grass and weed control.

With all these activities done, Mang Piring looked forward to the fruit of his labors.

Good harvest

It was a relatively good harvest of 120 50-kg cavans after the threshing.

But Mang Piring now had to distribute the crop to all the others who worked to produce it: For the harvester, eight cavans; the thresher, 10; the two helpers who put the grains in the sacks, one; and the informal lender who loaned P5,000, 15 (three for every P1,000).

He set aside 15 cavans for home consumption and emergency needs.

Mang Piring sold the remaining 71 cavans at P800 each--the previous buying price was P500--and he had a gross income of P56,800.

Still, he had to consider his expenses: For land preparation, P3,500; pulling, bundling and distribution of seedlings, P2,500; transplanting, P2,500; fertilizers, P8,000; irrigation service, P1,500; replanting and pulling of weeds, P700; snacks of transplanters and laborers, P300; dukit, P300; sacks, P960; and "kariada" (hauling sacks of palay from the field to the roadside), P1,110.

Mang Piring's total expenses reached P21,370, leaving him with a net income of P35,430.

It was, he said, better than the P15,000 he earned in the last wet cropping season.

Miller's story

But it's not all business for the rice millers, as they also have to contend with various expenses that eventually drive up the price of rice in the market.

Take it from Edgardo Alfonso, owner of the Agrinet Grains, one of the 22 rice mills in San Jose City.

"We rice mill owners are palay buyers, millers, and sellers of milled rice rolled into one," said Alfonso, who is vice president of the San Jose City Rice Millers Association. "While at times we end up with a relatively good income, we are often hit by forces beyond our control."

This was how he explained his operation:

Alfonso's agent goes out to look for palay and offers the "kalakaran" (prevailing price) to the farmer.

When the deal is forged at, say, P17 per kg, the farmer is paid in cash right in his farm, and Alfonso subsequently sends a cargo truck and men to transport the palay to his warehouse.

But the buying price of palay is given added value because of the expenses entailed in transporting and milling, including the agent's fee of 10 centavos per kg, transportation and labor at 20 centavos per kg, and drying at P9 per cavan.

There is "shrinkage" of an average 13 percent so that at day's end of drying the palay, a cavan of 50 kg becomes 43.5 kg.

"All told at this stage, the cost of palay bought at P17 per kg becomes P20.09," Alfonso said.

64-percent recovery

When palay is milled, it is not a 1:1 conversion, meaning a kg of palay when milled will not yield a kg of rice, Alfonso explained.

"The milling recovery is 64 percent," he said. "One 50-kg cavan of palay will yield 32 kg of milled rice."

There are also byproducts and wastes in milling.

The byproducts are darak (bran) and binlid, (brewers' rice), which total 5 kg. The wastes are ipa (rice hull) and some impurities (seeds, grass, grains of sand) with a total weight of 13 kg.

"Putting together the expenses from the purchase of the palay and milling it, a kg of rice has a breakeven price of P31.39," Alfonso said. "The proceeds from the sale of the bran and brewers' rice take care of the expenses for milling and purchase of sacks."

According to Alfonso, he would be lucky if his milled rice is bought at P32.50 a kg by his outlets in Metro Manila, which buy in wholesale.

Markups

"They don't make their usual order of truckloads of rice from us. They say consumers are looking for cheaper rice," he said.

From the wholesaler, the milled rice goes to the retailer with a P1 markup. "So the rice becomes P33.50 a kg," Alfonso said.

From the retailer, the rice is offered to the public. The retailer is considered lucky if he sells five cavans of rice in a day.

If the rice is sold with a P2 markup per kg (P35.50), the retailer earns P100 per cavan. Assuming he sells five cavans of rice, he earns P500 in a day.

Alfonso said his business was virtually at a standstill.

He said he had no more funds to continue buying palay, and rice milling had slowed down "because we are not getting orders from our usual customers."

"If only there is high demand for commercial rice from us, our capital can be rolled on to buy more palay for our continuous milling until the next harvest season," he said.

The province of Nueva Ecija is the country's biggest rice producer, and is often called "the Rice Bowl of the Philippines."

In 2007, Nueva Ecija produced 1.36 million metric tons of palay, making it the top producer among provinces for that cropping year.

It produced 1.14 million MT and 1.23 million MT of palay in 2005 and 2006, respectively.