rice preferences, price margins and constraints of rice value chain actors in nueva ecija,...
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AbstractBased on focus group discussions with farmers and interviews with other rice value chain actors, their rice preferences, price margins and constraints were identified. I will share my observations and insights from my trip to Nueva Ecija and seven-week internship at IRRI.Junghwan BaeIntern, Social Sciences Division, andBachelor's degree (Agricultural Economics) student,Seoul National University, Republic of KoreaTuesday, 24 February 201510:00am-11:00amSSD Conference Room, Drilon HallTRANSCRIPT
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Rice preferences, price margins and constraints of rice value chain actors in Nueva Ecija,
PhilippinesJUNGHWAN BAE
(MIGUEL)
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Objectives
Activities
Findings
Summary
Outline
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1.Understand how rice flows from farmers to consumers in Nueva Ecija, Philippines
2.Identify varietal preferences of farmers
3.Estimate price margins of value chain ac-tors
4.Identify constraints of value chain actors
Objectives
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The rice value chain
SeedFertilizer
LaborRent
farmerPaddy trader Whole-
saler
Miller
Retailer
BUT IT IS REALLY COMPLICATED!!!
I will show the result of the trip helped me understand the value chain
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Activities: IRRI
Materials.. Readings.. Reports..
Hull? Husk?160? 222?
Amylose content,
gelatinization temperature..
NFA?
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Activities: Nueva Ecija
Mon.(feb. 2)
Retailers In Munoz Market
Tue.
(feb. 3)Farmers In
Brgy. San Bernadino Millers
In Brgy. San Bernadino
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Retailers
In Guimba MarketWholesalers
In Guimba
Wed.(feb. 4)
Thu.(feb.5)
pasalubong
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When? : 2/03/15. Tue
Where? : Brgy. San Bernardino, Guimba, Nueva Ecija
With whom? : 3 households (husband and wife)
What? How? : FGD / Individual interview
Why? Determine farmers’ varietal preferences
Understand reasons for farmers’ varietal preferences
Identify their post-harvest problems
FGD / Individual interview
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FGD / Individual interview
1. The strong tendency to plant certain variety
All planted NSIC RC 222 (2013-14 DS & WS)
Because of high Yield2. Preference gap
Farmers are both rice PRODUCERS and CON-SUMERS.
The variety they grow is different from the variety they prefer to consume
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FGD / Individual interview
DRY SEASON WET SEASON
THE MOST PREFERRED TOP 3 VARIETIES
NSIC RC 222(TUBIGAN 18)
∵ High Yielding
SL8(hybrid)
∵ High Yielding
NSIC RC 152
∵ High Yielding
NSIC RC 160(TUBIGAN 14)
∵ Delicious (Soft..)
SL7(hybrid)
∵ Delicious (Soft..)
NSIC RC 222(TUBIGAN 18)
∵ High Yielding
NSIC RC 222(mixed with 160)
∵ soft, increase vol., reasonable price
As a PRODUCER
As a CONSUMER
As a PRODUCER
As a CONSUMER
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FGD / Individual interview
DRY SEASON WET SEASON
THE LEAST PREFERRED TOP 3 VARIETIES
NSIC RC 160(TUBIGAN 14)
∵ Low Yield
NSIC RC 222(TUBIGAN 18)
∵ Hard(after cooling)
HYBRID
∵ vulnerable to ty-phoon
NSIC RC 222(mixed with 160)
∵ soft, increase vol.Reasonable price
As PRODUCER, they prefer NSIC Rc 222 for high yield.
But as CONSUMER, they consider eating quality of the rice.
As a PRODUCER
As a CONSUMER
As a PRODUCER
As a CONSUMER
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FGD / Individual interview
3. Capital problem
Paddy After Drying(14% mc) : ₱23-24/kg
Paddy Before Drying(22~24% mc) : ₱19-20/kg
1. Lack of drying facilities!
2. Farmers need to pay debts as soon as possible to minimize interest.
Why?
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FGD / Individual interview
4. Income
Per ha, per season
Net income ₱50,000
GROSS
PRODUCTION
operational
COST
₱81,381
GROSS
INCOME
₱131,381
PRICE
₱19-20 / kg
Margin for 1 kg ₱7.42
110-135 CAVANS
(1 cavan = 55 Kg)
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FGD / Individual interview
What else?
Famers set paddy aside for home consumption, but the
amount depends on each household.
(it varies from 22 cavans to 55 cavans according to season,
family members)
They have been producing NSIC RC 222 for a long time
because it is high yielding, but they don’t prefer this vari-
ety for home consumption. But they don’t have a choice so
they consume this variety.
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Milling
He is the Capitalist!
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Milling
Service fee : 2 pesos / kg(for milled rice)
Almost all are farmers (90%)
50% for LOCAL, 50% from OTHER VILLAGES (= SUKI)
20%For
Opera-tor
₱0.4/kg
30%For
Diesel
₱0.6/kg
50%For
Owner
₱1/kg
Customers :
Small mill (only service provider)
Owned by a farmer with 10ha, with hired operator
MILLER
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Milling
1 cavan of
paddy
Recovery can reach up to 70% according to the
varieties, drying conditions (usually 50~60%)
Low marketability
(Fuel for cooking, mulching to prevent the
evaporation of the onion farm)
Milled rice
Husk / others
Bran
Brewer
50%
31%
18%
1%
High profitability (For piggery)
₱7/kg -> ₱12/kg (1 month later)
For Feeding chickens
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What is your problem?
SKIN PROBLEM
(ITCHINESS)
OPERATOR
‘If I have enough money,
I would have gotten my own mill..
Because it would give me more income’
RESPIRATORY PROBLEM
(HARD TO BREATHE)
Milling
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Wholesaling
Whole-saler
2 Wholesalers in Guimba (wholesaler and retailer)
They are the richest actor I met in Nueva Ecija(Retail shop, warehouse, truck..)
2 pesos / kg
when wholesaling
When retailing
PROFIT
1 pesos / kg
Customer compositionTrading volume
15~30 cavans of milled rice/day
Consumer (50%)
Retailer (50%)
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100%Wet paddy
Wholesaling
AGENT(BROKER)Intermediary between
Wholesalers/paddy trader and Farmers
78%Dry paddy
46.8%(MAX.52%)Milled rice
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Buying paddy : ₱28,500 (₱ 19/
kg)
Agent fee : ₱150 (₱ 0.1/kg)
Delivering (labor) : ₱30 (₱ 1/ca-
van)
Drying paddy : ₱120 (₱ 4/cavan)
Their income for 1 day by wholesaling
₱2,572 / day
Wholesaling
30 cavans(wet paddy)
15 cavans (milled rice)
23.4 cavans(dry paddy)
Milling : ₱2,340Delivering (labor) : ₱23 (₱ 1/cavan)
Selling milled rice : ₱33,750(average selling price per kilo: ₱ 45)
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Wholesaling
CREDIT TRANSACTIONS
They don’t get paid
Delayed payments
What is your problem?
WHOLESALER/paddy trader
THREAT OF THE IMPORTED RICE
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RETAILING
Total 8 retailers (3 from Munoz, 5 from Guimba market)
SCALE
Retailer
Small retailer
Big re-tailer
Only selling rice
With wholesalingSelling other items
Sell 2 cavans/day
Low cost-> high profit
2 pesos / kg
High
Low
PROFIT
Sell 10 cavans/day
High cost-> Low profit
1 pesos / kg
Type of retailer
Scale, Profit, and Type of retailer are different
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RETAILING
LOW PRICE HIGH PRICE
DOUBLE DIAMOND, ANGELIKA, JAS-MINE, 160. 216
NO LABEL!(Rambol) LABEL
PRICE
RUMBLE(REGULAR MILLED RICE
35 38~40
LONG GRAIN160,216, DOBLE DIAMOND, ANGELIKA, JASMINE
42 48
27 32
NFA RICE
RUMBLE(WELL MILLED RICE
38 45
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Many broken grains
PROPERTY
Whole grain
Not translucent Translucent
Has impurities Little/no impurities
Not uniform Uniform size and shape
LOW PRICE HIGH PRICE
NFA Rice₱27/kg
NSIC RC 160₱46/kg
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RETAILING
NFA rice
If you want to sell NFA rice,you need license!
1 consumer is allowed to buy maximum 5kg at one time!
Best seller rice!
I don’t sell NFA rice anymore!
‘I have to go, and wait for getting the rice, and bring it by myself.. It
is a waste of time!!’
NFA MONITORING
NFA officers check the present condition of the NFA rice
EVERYDAY!
Because it is CHEAP!!(₱ 27, ₱ 32)
LICENSE/REGULATION
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RETAILING
Retailers pay high price to buy long grain rice,
but they are cheated by suppliers and they get
lower quality rice.
Retailer
What is your problem?
RETAILERS who are also wholesalers hire CLAS-
SIFIERS to identify the right quality.
So they are not swindled.
Small retailers are more prone to buying the low-quality rice
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Limitations..
My findings are indicative of what happens in Nueva Ecija but does not represent the general sit-uation in the area.
The small number of the value chain actors interviewed
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What I learned..
Got balanced viewpoint: Different perspectives
I achieved what I wanted to know!
Rice value chain
Price margins
Problems
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Before Coming to the IRRI…
STUDENT
Agricultural economics
Swimming, baseball, outdoor sports..
28(26) years old
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Before Coming to the IRRI…
IRRI???
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But what I realized..
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But what I realized..
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Thank you