February 22, 2016
Mary Grace Padin (Business Mirror) | http://goo.gl/PD3qCC
The Philippine government on Monday said it has allowed traders and millers to import 170,000 metric tons (MT) of sugar to stabilize the supply and price of sugar.
The Sugar Regulatory Administration (SRA) also said the Philippines could import more sugar if El Niño significantly cuts sugarcane output this year.
SRA Administrator Ma. Regina Bautista-Martin said the 170,000 MT of sugar will be imported under the US sugar quota and export replacement program of the agency for crop year (CY) 2015-2016.
“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.
Martin said sugar production for the current CY is projected to reach 2.15 to 2.19 million metric tons (MMT), lower than last year’s output of 2.32 MMT.
Earlier, Manila decided to allow the export of 135,508 MT of raw sugar to fill up the Philippines’s allocation under the US tariff-rate quota (TRQ) scheme. Countries authorized by the US to export sugar under TRQ can do so at lower duties.
The US is a preferred market for Philippine sugar producers because American end-users buy sugar at a premium price.
According to Martin, five traders will import the volume as they complied with Sugar Order 4, which provided the guidelines for the US sugar quota and export-replacement program. They will also export the volume of sugar required by the US.
Philippine Sugar Millers Association President Francisco D. Varua said traders will buy most of the sugar from Thailand. Sugar is levied a 5-percent tariff under the Asean free-trade agreement.
Also, Varua said Thailand is the nearest country with available sugar. He said the shipments will arrive in the country on a staggered basis, but all imports are expected to arrive before April.
“[We will be importing] both raw and refined sugar, although the SRA is encouraging the importation of a sizable portion in raw form to provide more business to our local sugar refineries,” Varua said.
The arrival of sugar imports is expected to cut the price of refined sugar by P5 per kilogram, he said.
“Presently, refined sugar is being retailed in groceries and supermarkets at P55 per kilogram, which is within the suggested retail price of the Department of Trade and Industry,” Varusa said.
“Based on my computation, the imported refined sugar should retail at about P50 per kilo. The main objective of the SRA for the import program is to make sugar more affordable,” he added.
Meanwhile, Martin said the SRA is closely monitoring the impact of El Niño on the country’s sugarcane production. “We are only 60 percent down with milling, so we are closely monitoring our production given that it has already rained in the Visayas, contrary to initial forecasts,” Martin said.
Varua said a “clearer picture” of El Niño’s impact on sugarcane output could be seen by March.
“We have to wait until the second half of March to get a true picture of the effects of El Niño and to what extent production will drop compared to the previous crop year,” he said.
Data from the SRA showed that the country’s raw sugar output as of January 31 reached 1.203 MMT. This is still comparable to the output recorded as of January 25 last year, which stood at 1.202 MMT.
Refined sugar production as of January 31 declined by 9.07 percent to 405,627 MT, from 446,075 MT recorded last year. Raw and refined molasses output rose by 9.35 percent to 487,655 MT, from 445,957 MT.