June 17, 2015
Czeriza Valencia (Philippine Star) | http://goo.gl/OnpCLd
MANILA, Philippines - The Sugar Regulatory Administration (SRA) has lowered the conversion fee for world market “D” sugar to domestic “B” sugar under the ongoing reallocation of stocks.
Through a sugar order dated June 10, SRA administrator Ma. Regina Martin ordered the reduction of the conversion fee of P20 per 50-kilogram bag to P10 per 50 per kilogram bag.
The reduced fee applies to “D” sugar quedans for the remainder of the sugar crop year as well as to a specific volume for unshipped “D” sugar produced during the previous crop year.
The sugar regulator is allowing the conversion of some 70,669.99 metric tons (MT) of unshipped “D” sugar produced during the current crop year to domestic sugar.
Also covered by the lower conversion fee are 4, 440.868 MT of unshipped “D” sugar produced during crop year 2013 to 2014.
The Philippines early this month stopped all sugar exports to the United States and the world market to protect domestic supply and prices as the prevailing dry spell cuts production below target.
For the current crop year, the Philippines has a regular sugar export quota to the US–as represented by “A” sugar quedans–of more than 138,800 MT. As of March, the Philippines has so far shipped out 60,000 MT to the US.
Martin said she was assured by the US Department of Agriculture (USDA) the exportation shortfall would not affect the country’s future export quotas.
With only two mills left operating, the country’s aggregate sugar production is expected to reach only 2.31 million MT from the original target of around 2.5 million MT.
A slowdown in cane production in the Visayas as result of the prevailing dry spell, combined with strong industrial demand is putting a strain on domestic supply.
Cane supply in the Visayas, particularly in Negros – where more than half of the country’s supply produced – is lower because of the intense heat.
The speculation of traders who want to secure supply in the event of a production shortfall is also seen to affect domestic supply.