January 12, 2016
Mary Grace Padin (Business Mirror)|http://goo.gl/PT3Xmz
The country’s sugar farmers and millers are now feeling the drop in their sugar production, as El Niño continues to linger in the Philippines, an industry group said on Tuesday.
Philippine Sugar Millers Association (PSMA) President Francisco D. Varua told the BusinessMirror that sugar farmers and millers in the country are already seeing lower yields only about four months into the current crop year (CY).
“[The decline in sugar production due to El Niño] has already been verified as we go along. Milling has started already and we are already feeling the drop in production in various mill districts,” Varua said in a phone interview. The country’s sugar production season starts from September to August every year.
Sugar Regulatory Administration (SRA) Administrator Ma. Regina Bautista-Martin earlier said the latest estimates of the agency, as of October 2015, revealed that the country’s sugar output for CY 2015 to 2016 may only reach 2.228 million metric tons (MMT), 3.55 percent lower than last crop year’s total production of 2.31 MMT. The SRA attributed the expected decline to the “unfavorable” weather conditions and reduction of sugarcane areas.
Furthermore, data from the SRA showed that raw-sugar production from September 1 to December 13 declined by 31.79 percent to 511,885 metric tons (MT), as compared to 750,488 MT reported in the same period last year.
To combat the impacts of the prolonged dry spell, Varua said the PSMA is making arrangements with the Department of Agriculture (DA) to conduct cloud-seeding operations in different parts of the country.
The SRA, for its part, assured that it will closely monitor sugar production in 2016 and will be ready to “ensure stable and sufficient supply of sugar, notwithstanding severe droughts caused by El Niño.”
Varua said the sugar farmers and millers are also expressing their worries over the lingering dry spell’s effect to the next cropping season.
“Hopefully, it will not drastically affect the production in the next crop year. If the El Niño persists, then even the next crop year will also be affected,” he said.
Meanwhile, the industry leader said based on initial estimates, at least 130,000 MT of raw sugar will be shipped to the US to fill up the country’s quota.
“The initial report is the whole quota of 130,000 to the US will be shipped out. That’s the estimate that I’m getting from all the traders that I have contacted,” Varua said.
The SRA recently released Sugar Order 4, authorizing the export of 135,508 MT of sugar to the US under the tariff quota scheme.
“All ‘A’ or US quota sugar quedan-permits issued in previous crop years are eligible for shipment…provided that the ‘A’ or US Sugar quota sugar quedan-permits are verified and reinstated,” the SO read.
“In the event the volume of reinstated ‘A’ sugar is not sufficient to fill up the allocation to the Philippines, locally produced, original ‘B’ or domestic market sugar/quedans for CY 2015 to 2016 and for two previous crop years shall be eligible for shipment to the US,” it added.
The SRA said those who will export to the US using domestic sugar may replace the volume by importing raw or refined sugar from the world market, keeping in mind the volume needed to balance supply and demand in the local market.