June 2, 2015
Sugaronline | http://goo.gl/2lDqpG
The Philippines said on Tuesday it was scrapping export plans in favour of allocating to the domestic market all its sugar output, beginning from the last week of May and over the next three months, as it seeks to rein in rising local prices, according to Reuters.
The move is unlikely to affect the global market, which now faces a sugar glut, but will effectively halt supply from the Southeast Asian country to key markets, chief among them the United States.
Boosting domestic supply could help to halt a price rise the Philippine central bank has pinpointed as a key source of inflationary pressure.
A "comfortable buffer" must be maintained to ensure stable supply and prices, the Sugar Regulatory Administration said in a policy announcement on its website.
"There are speculations that domestic supply will be tight, that's why local prices are rising," Regina Bautista-Martin, the administrator of the state agency, told Reuters.
The SRA has cut its output forecast for the 2014/15 year for a second time, to 2.32 million tonnes, from 2.465 million announced in March, citing unfavorable weather conditions.
Raw sugar output in the current crop year, which ends in August, stood at nearly 2.3 million tonnes by May 17, SRA data showed.
Also in March, the agency cut export allocations to just 5% of the revised 2014/15 output forecast, from 10% of a projected 2.5 million tonnes set at the start of the crop year.
The Philippines has shipped 60,801 tonnes to the United States for the current crop year, or 45% of its annual quota shipment of 136,201 tonnes, SRA data showed.
Exports to other markets totaled 6,893 tonnes, down 95% from the 2013/14 crop year.