March 8, 2016
Mary Grace Padin (Business Mirror) | http://goo.gl/mWMua7
THE Philippines will be allowed to export more sugar to the United States at reduced tariff rates, after Washington provided Manila with an additional 12,194 metric tons (MT) of raw sugarcane allocation.
The additional raw-sugar allocation for fiscal year 2016 was announced by the US Trade Representative (USTR) in a statement dated March 7.
Manila was earlier given an allocation of 135,508 MT under the tariff rate quota (TRQ) scheme, which allows recipient-countries to export sugar to the US at lower duties.
Of the 86,533 MT of raw cane sugar reallocated by Washington, the Philippines obtained the second-largest additional quota. The USTR said the allocations were based on the countries’ historical shipments to the US.
The volume reallocated by Washington came from countries that were unable to fill previously allocated raw-sugar TRQ quantities.
Philippine Sugar Millers Inc. President Francisco D. Varua told the the BusinessMirror the USTR’s announcement came after the American Sugar Alliance (ASA) sought for the immediate reallocation of the TRQ to fill the requirement of sugar refineries.
“I think the USTR acted on the petition of the ASA for an early allocation of the quota to satisfy the immediate requirement of sugar refineries. The International Sugar Trade Coalition [ISTC], of which the Philippines is a member, supported the ASA’s petition,” Varua said.
The ASA and the ISTC made the request for the reallocation of the raw cane sugar TRQ in a letter addressed to the US Department of Agriculture and the USTR dated February 18.
However, the PSMA said the local sugar industry may not be able to fill up the additional quota, as this would be too costly for traders.
“The [12,194 MT] volume cannot fill up a boat, since chartered ships would normally be in the category of 25,000 to 30,000 tons. To charter a vessel of 12,000 tons would cost expensive dead freight,” Varua said.
Traders and millers were earlier allowed by the Sugar Regulatory Administration (SRA) to import 170,000 MT of sugar under the US sugar quota and export replacement program of the agency for crop year 2015-2016.
Earlier, SRA Administrator Ma. Regina Bautista-Martin said the volume will be used to replace the 135,508-MT regular quota to be exported to the US, fill the projected shortfall in local sugar production and stabilize domestic prices.
“We are importing 170,000 MT to replace the sugar exported to fill the US quota. This volume already includes the 5-percent additional imports to balance the drop in production of around 8 percent,”Martin said.
According to the estimates of the agency, sugar production for the current crop year is projected to reach 2.15 million to 2.19 million metric tons (MMT), lower than last year’s output of 2.32 MMT.
Data from the SRA, meanwhile, showed that the country’s raw sugar output as of January 31 reached 1.203 MMT, which is comparable to the 1.202 MMT produced as of January 25, 2015.