Assessment of the economic benefits of the National Food Authority rice procurement program to farmers in Calauan and Victoria, Laguna

Date

4-2011

Degree

Bachelor of Science in Agricultural Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Isabelita M. Pabuayon

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Abstract

This study assessed the economic benefits of the National Food Authority Rice Procurement Program to farmers in Calauan and Victoria, Laguna. To achieve the objectives, descriptive analysis, correlation analysis, costs and returns analysis, test of hypothesis, and logistic regression analysis were employed, utilizing primary data obtained from 60 farmers through personal interviews and secondary data from different government agencies. The NFA Provincial Office is located in Brgy. San Ignacio, San Pablo, Laguna. As of January 2011, NFA had three buying stations where the farmers could deliver their palay. Farmers/farmers’ groups were required to obtain passbook and meet the quality specifications to be able to sell to the NFA. To encourage farmers to support the program, NFA conducted information campaign using various means. The NFA palay procurement in Laguna has remained low over the past years with an annual average of 0.38 percent from 2000 to 2010. This low procurement level could be attributed to Laguna being a rice deficit province and the problems encountered by the farmers in selling to the NFA. This resulted to the inability of the procurement program to influence the farmgate price of palay. The net price received by farmers who sold to the NFA (P15.80) was higher than that received by farmers who sold to the traders (P10.93 and P11.49 for different and similar qualities of palay, respectively). Farmers who sold to the NFA received higher total revenue net of marketing cost than those who sold to traders with differences of P74,464 per farm and P7,758 per hectare. Results of the costs and returns analysis showed higher net farm income for farmers selling to the NFA (P8,319) than those selling to the traders (P561 and P3,245 for different and similar qualities, respectively). Generally, the differences could be attributed to the higher price paid by the NFA to the farmers. The logistic regression analysis showed that only the marketable volume significantly affects the decision of the farmers to sell to the NFA. The relationship is negative implying that the larger the marketable volume of the farmer is, the less likely he is to sell to the NFA. The major problems encountered by the farmers included rejection of palay by NFA, many requirements for registration, deferred payment, use of traders of the farmer’s passbook, credit-marketing tie-up to the traders, and inconvenient selling to the NFA. It is recommended that the government (a) reassess its current operations and allocate their resources to areas where the program is most needed; (b) address the problems with deferred payment, many registration requirements, and high quality requirements; and (c) devise and implement a targeting mechanism to serve the poorer farmers.

Language

English

Location

UPLB Main Library Special Collections Section (USCS)

Document Type

Thesis

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