Analysis of the transfer cost of palay/rice from Nueva Ecija to selected demand centers in Luzon, 2010

Date

4-2011

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Julieta A. Delos Reyes

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Abstract

The study analyzed the transfer cost of palay/rice from Nueva Ecija to selected demand centers in Luzon. Descriptive analysis, multiple regression and correlation analyses were used to analyze the primary data gathered from the interviews conducted among 30 palay/rice farmer-trader respondents from Palayan City, Nueva Ecija. Secondary data were also gathered from the Bureau of Agricultural Statistics (BAS) and Provincial Agricultural Office of Nueva Ecija to provide an overview of the palay/rice industry in Nueva Ecija. Palay/rice is transported using jeepneys for small volume handled and trucks for large volume handled as well as for long distance travel. Transfer cost was higher using jeepney as mode of transportation. This was evident in both transfers to Zambales and Cavite with transfer costs amounting to Php2.77/cav/km and Php0.90/cav/km, respectively. Among the three destinations, transfers to Zambales were found to have the highest cost amounting to Php2.77/cav/km and Php0.87/cav/km using jeepneys and trucks, respectively. Cavite had the lowest transfer cost amounting to Php0.90/cav/km using jeepneys and Php0.28/km and trucks. On the other hand, transfer cost in Metro Manila was Php0.29/cav/km using trucks as mode of transportation. Multiple regression analysis showed that distance, number of transport crews, number of checkpoints, toll fees and mode of transportation significantly affect transfer cost. The coefficient of determination (R2) revealed that 65.76 percent of the changes in the transfer cost were captured by the explanatory variables. Transfer-related problems were: 1) collection of illegal fees or “kotong”; 2) poor road condition which leads to other problems such as, accidents, flat tires and engine malfunction; and 3) high toll rates. Based on the results of the study, the following were recommended: 1 provision of incentives for the farmer-traders who use jeepneys to pool themselves in to cluster to achieve efficiency in transporting palay/rice by utilizing trucks instead of jeepneys since trucks were found to be more cost efficient; 2) there should be stricter enforcement of the Food Lane Program of the government and the ratification of the House Bill No. 246, An Act Penalizing The Commission of the Act of “Kotong” Committed by Law Enforcement Officers and Public Officials and for Other Purposes, also known as Anti-“Kotong” Act of 2010, introduced by Hon. Juan Edgardo Angara of the Fifteenth Congress, should be done; 3) the DA in cooperation with the DOTC should negotiate for a special e-pass for agricultural commodities to lower toll fees; and 4) improvement of roads, bridges, to facilitate the transportation of palay/rice and minimize transport problems concerning roads.

Language

English

Location

UPLB College of Economics and Management (CEM)

Document Type

Thesis

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