SRA lowers sugar production estimates for 2023

February 15, 2023
The Philippine Star|

MANILA, Philippines — The Sugar Regulatory Administration (SRA) board has lowered its sugar production estimates for this crop year, with shortfall to be addressed by the importation program and released in a calibrated manner to lower retail prices and protect farmers.

In an interview, SRA board member-planters’ representative Pablo Luis Azcona said the board is projecting raw sugar production to reach 1.831 million metric tons (MT) in crop year 2022-2023.

The figure is slightly lower than the pre-final crop estimate of 1.834 million MT released last December.

In its pre-crop year estimate, sugar production was projected to reach 1.876 million MT.

“For this year, we are expecting a projected production of 1.831 million… but our demand is a lot more. We feel that the 440,000 MT is just right to cover this year’s lack of sugar. This will cover from now until we begin milling next year,” Azcona said.

The SRA board earlier pegged the total raw sugar withdrawal to reach 2.03 million MT this year.

However, the latest projection is still higher than the 1.82 million MT raw sugar produced in the previous crop year.

“We expect production to be better than last year, but last year was a bit bad. By better than last year, the improvement is not really significant,” Azcona said.

The recently approved 440,000-MT refined sugar importation, once cleared by President Marcos, is seen to address the high retail prices of the sweetener.

Azcona said the import program would be divided into three tranches: 100,000 MT, 100,000 MT and buffer stock of 240,000 MT.

“The three arrivals… are all arriving as reserve. The authority to convert and make it available to the market was left with the sugar board,” Azcona said.

Meanwhile, the board is also recommending the inclusion of the recently approved 64,050-MT refined sugar through the minimum access volume (MAV) mechanism to be part of the calibrated release to the market.

“The information that we got is the (sugar under) MAV’s arrival is February to December. There have been moves, as suggested in the meeting, if we do the calibrated release, it will be inserted so it will not compete with the 440,000-MT sugar importation plan… so it will not flood the market,” Azcona said.

“Even though the MAV program is not part of the SRA, we are considering all sources of sugar. We also considered the possible impact of the closure of the Central Azucarera Don Pedro (CADP). This was a sudden closure, and we were not prepared for this. All of that was considered into coming up with the final volume,” he said.

“By doing so, the SRA Board controls when and how much sugar can be made available to the market.”

“We need to put effort to carefully calibrate the reserves to domestic. We will not release the entire reserves in one go because it will come down to people hoarding, which happened before we learned from it. The idea of keeping a buffer in the country and calibrating releases to the market will ensure adequate supply of sugar as needed,” Azcona said.

With this year’s sugar importation plan, the retail price of refined sugar could go down to P85 per kilo.

“I cannot really say an accurate amount, but we are hoping the retail price will be somewhere around P85 per kilo,” Azcona said.

As of yesterday, refined sugar still retails at P110 per kilo based on monitoring of the Department of Agriculture (DA).

The DA can also issue a suggested retail price (SRP) for refined sugar to give retailers a guide on the pricing of the sweetener.

“Based on local, the suggested SRP is P90. Hopefully, we can lower that SRP and hopefully, DA can come up with an SRP for retailers to follow, consumers can enjoy a better price and farmers will not be gravely affected,” Azcona said.

In October, the DA said it was coordinating with the SRA to implement an SRP on refined sugar, with a target to issue this a month after.

However, no SRP was issued on refined sugar in November.

Former SRA chief Lito Coscolluela earlier urged the government to impose an SRP instead of importing refined sugar anew to bring down retail prices.

Coscolluela is the adviser of the Confederation of Sugarcane Farmers.