The Rice Farmer In 2020: A Business Outlook Amid COVID-19

Our rice fields are located in different areas of the town and a bit far from the farm. This is the reason why I have such great admiration for my Dad for his strength, patience, and wisdom to manage all of them and several teams of farm workers.

I believe it was somehow easy for Dad because he used to work as a Civil Engineer and Chief Superintendent at the National Irrigation Administration in our town. It was part of his duties as an engineer to monitor the irrigation system in the rice fields.

Rice Farming Through The Years

Back when I was young, we used to cook food for our farm workers during the harvest season. But as our parents got older and my siblings and I came here to study and work in the city, they had to let go of some of our usual practices in farm management.

Not a single day passes by though that I don’t include them and our agribusiness in my prayers. I have this dire need to go to the province now, stay there, and give them a hand with what needs to be done at the farm and the ricefields.

When God Dictates Your Timeline

However, my husband is tied to his job here in the metro, and he remains my top priority. The calling to go back to the province may be too strong, but God is asking me to stay for now.

I had my worries, my questions, and also my fears. But God assured me He got everything under control.

A Year Of Blessed Harvest

True enough, for last year’s palay harvest, Dad reported an all-time high yield. My parents said it was a miracle given the extended drought. Our province was also hit several times by strong typhoons last year but Dad was able to harvest the palay grains at just the right time.

My Dad’s rice fields were also selected to be the demo farms for the hybrid rice grains provided by SL Agritech. He was given an allowance for the land preparation and fertilizers and in return, a certain percentage of the harvest will go to SL Agritech.

The Good News Means God Is Everywhere Anytime

These were all the good news that will testify that indeed, God hears our prayers. I still have a little bit of those fears as to what could happen in the future.

But I know God will be there in every step of the way to guide us, provide for us, and strengthen us. I am sure every business owner out there has the same qualms about the future of several industries in the country given the economic recession.

Our Business Outlook In The Future

And yet not every “low” will forever be a “low” in the same way that not every “high” will forever be a “high.” The only assurance that we can get is that in every season of our businesses, God is with us always. That should replace our fears with faith, our worries with peace, and our uncertainty with hope. 🙏

Praying for all business owners out there,

Blog Signature

Farmers & Traders: What Really Goes On In The Rice Farming Industry

How the agribusiness industry fared throughout the years can be attributed from the bargaining that takes place between the farmer and the trader even before the products leave the farm gate. My family and I have been in the agribusiness, palay production in particular, for decades already. But it was only just recently that I ran a thorough analysis of the business processes involved in farming from the particulars in expenses to the actual farm tasks done.

20190103_180055_edited

I asked Dad to give us a rundown of all the marketing processes involved but he told us we’ll learn along the way. I guess this is his way of saying that we conduct due diligence as far as agribusiness is concerned. 😉

From the data I gathered on Dad’s documents, what caught my attention is the market price of palay listed in one of the receipts (16.50php/kg). I asked Dad who dictates the market price and how did it arrive at that figure. He only smiled and said, “The traders dictate the market price.” My follow-up question was, “Based on what?” He answered, “Based on the market trends.”

20190103_175335_edited

So, this is just like stock trading on a certain level. But here, if you’re a trader, you have the market power to set the price you desire. Depending on how you conduct your dealings as a businessman, this can either be a good thing or a bad thing as far as fair agricultural trade is concerned. Are traders really fair in dictating the market price for a particular agri product in the region? Does it follow regional market rates or the national market rates?

I haven’t taken any business education courses but I really would love to and if God wills it, I plan to take up a short course on Market Research. For the meantime, I’ve been doing my homework on farmers and middlemen and how the theory of bargaining works in the farming industry. These are the questions I came up with:

  • Are farmers actually getting the profit they should earn from the entire production?
  • Can a digital economy change the agricultural landscape in the coming years and provide better marketing opportunities both for the farmers and traders?
  • Will agricultural innovations and agritech industries promote a brighter future for the farming sector i.e. lower transportation costs, high-yield production, etc.?
  • How can a government-mandated price ceiling affect the overall trading setup between the middlemen and farmers?
  • Can contract farming and direct selling be viable marketing alternatives?
  • How can we prevent the exercise of “monopsony” in marketing rice/palay?

If you’re in the agribusiness industry and are interested to venture in palay/rice production or any crop production, these articles can provide some insights on the current market setup of farming and agriculture in the country:

https://business.mb.com.ph/2017/10/30/pinol-wants-to-liberate-farmers-from-middlemen/

https://ageconsearch.umn.edu/bitstream/174795/2/agec1999v020i002a001.pdf

https://businessmirror.com.ph/government-needs-to-increase-its-palay-support-price-but-by-how-much/

https://www.untvweb.com/news/dti-da-to-impose-price-ceiling-for-traders-middle-men/

https://psa.gov.ph/content/costs-and-returns-palay-production-0

I’ll be sharing more information as I go along with my market research/business analytics during my free time. Please bear with me if I’ll confuse you a bit with some of my questions since I am also on “tabula rasa” mode when it comes to business developments and the likes. 😀

But if you have any insights to share, please don’t hesitate to drop me a message. I’d love to hear your feedback/suggestion. Thanks in advance and for reading this article. ❤

“For I know the plans I have for you,” says the LORD. “They are plans for good and not for disaster, to give you a future and a hope.” – Jeremiah 29:11