Group wants government to lower volume of sugar imports

January 30, 2023
Philippine Star|

MANILA, Philippines — A group of sugar producers is urging the government to lower the volume of sugar importation this year.

In a statement, the Confederation of Sugar Producers Association (Confed), headed by Aurelio Gerardo Valderrama Jr., said it has recommended the importation of a more conservative volume of sugar, compared to the proposed 450,000 metric tons “two months buffer stock” being mulled by the Department of Agriculture and Sugar Regulatory Administration (SRA).

The recommendation was made in a letter submitted to the SRA last Friday.

President Marcos has said he wants to maintain a two-month buffer stock of sugar to stabilize supply and prices. Sugar prices have remained high, ranging from P92 to over P100 per kilo in wet markets, and up to P138 for a certain brand in some supermarkets.

In the same letter, the group cautioned the SRA to stagger the volume of importation and schedule its arrival judiciously, so as not to adversely affect mill gate sugar prices at the tail end of the current milling season and at the start of milling in the coming crop year.

This follows the pre-final crop estimate and the Raw and Refined Sugar Supply and Demand Projection for Crop Year 2022-2023 as well as the Summary of Actual and Projected Sugar Requirements of the CSD Industry sent by the SRA to Confed.

The SRA, however, has not sent its draft program for the volume and schedule of arrival of the proposed 450,000 MT importation as sought by sugar industry players.

Confed replied to the data provided by the SRA, recommending for a more conservative volume for importation and the staggered arrival of sugar imports, such that the importation will not depress mill gate prices at the end of the current crop year’s milling as well as during the start of next year’s milling season.

Moreover, Confed urged SRA to institutionalize an orderly sugar policy mechanism by establishing “trigger points (determined through timely assessment of consumption versus supply trends) that will signal the need for consultations with the industry to determine the appropriate sugar policy at any given time.”

Confed recommended that SRA formally activate and engage the Stakeholders Consultative Assembly, setting guidelines for its composition and representation; the manner, schedule and venue of consultations, and the provision of pertinent and timely information for the guidance of all stakeholders.

The federation’s letter was in response to the call by the SRA for comments and recommendations from industry stakeholders regarding the request for importation made by the carbonated soft drinks (CSD) industry, represented by the manufacturers of Coca-Cola, Pepsi-Cola and RC Cola.

In a letter to President Marcos dated Jan. 6, the CSD industry informed him that the current sugar inventory will last only until the second quarter of 2023.

The projected sugar shortage endangers the continued operation of their bottling plants, risking the livelihood of thousands of employees, dealers and downstream businesses.

Thus, the CSD industry requested the President to put in place a supplemental sugar importation program by the end of the first quarter of 2023, considering that it will take “about four to five weeks lead time to account for transit time, processing and shipping line booking.”

Soda makers warned that any delay in the arrival of sugar supply might result in the slowdown, or even shutdown, of their operations.

However, the letter-request did not contain the proposed volume of sugar needed by the CSD industry and the proposed schedule of arrival of their importation.

Three planters federations – the Confed, National Federation of sugarcane Planters and Panay Federation of Sugarcane Farmers – submitted separate letters to SRA reserving their final decision on the CSD industry’s request, until such time that SRA and the CSD industry provide them with specific figures to justify the request.

Earlier, President Marcos stated that the country needs a two- month buffer stock to ensure reliable sugar supply and stable retail prices of sugar.

No to sugar importation

Meanwhile, the Save the Sugar Industry Movement  (SAVE-SIM) has submitted its position paper to the SRA, expressing opposition to the 450,000-MT importation of sugar this year.

SAVE-SIM lead convenor Wennie Sancho disclosed that the sugar importation sent chills down the spine of the stakeholders in the industry.

It will not only deregulate the sugar industry, but also remove quantitative restriction and protection of local sugar under the terms of the ASEAN Trade in Goods Agreement, Sancho said.

He added that the unregulated entry of subsidized imported sugar would be disastrous to the sugar industry, which contributes billions of pesos to the country’s GDP, specifically to the 84,000 sugar farmers and 700,000 industrial workers across 28 provinces of the country. –  Gilbert Bayoran