Why costly rice production?
Why is the cost of production per ton of paddy higher in the Philippines than in other countries? The most important reason is that rice is expensive in the Philippines. The payments for labor and other ser-vices used in rice production are paid for in terms of a share of the harvest. Therefore, the farmgate price of paddy is an important aspect of rice farming costs. Workers who help in land preparation, harvesting and threshing are compensated in terms of shares of the harvest, with the shares largely determined accor-ding to long-standing community customs and traditions. Wages and labor costs are determined by multiplying the price of paddy with the paddy share in volume terms. To make production cost figures comparable across countries, the costs were expressed in terms of the US Dollar. Thus, since the farmgate price of paddy in the Philippines is higher than in most other countries, the cost of rice production contributed by labor, the largest input, is large. It should be noted
