Sugar output enough to meet local demand, US quota, agency says

May 11, 2018

BusinessWorld (Anna G.A. Mogato) |

The Philippines’ sugar production will be enough to meet local demand and, at the same time, satisfy allotments for the country’s US quota for this crop year, the Sugar Regulatory Administration (SRA) said on Friday.

Although “scarcity of cane cutters” has delayed harvests in certain areas, production targets will still be met this year, Hermenegildo R. Serafica, SRA administrator, said in a statement, referring to the 2.27 million metric ton (MT) target set for this year. The target is lower than last year’s 2.5 million MTs due to the expected unfavorable weather.

Data from the Philippine Statistics Authority showed that the lack of manpower in sugarcane fields, especially in Western Visayas, caused a drop in production in the first quarter by 11.56% due to delayed harvest.

Heavy rains in Northern Mindanao late last year also affected the crop output.

“We have the canes [to mill], but the problem besetting the industry at the moment is the scarcity of cane cutters. The canes have to be harvested and brought to the central for milling,” Mr. Serafica said. “That is why some mills may end much later in the crop year, around June or July, and others to start earlier to take advantage of the remaining canes.”

While some farmers are already on their second cycle for sugarcane, the SRA chief said that this would mean additional supply in the market.

With lower price quotations from the sugar milling stations, its price dropped by 11.55%. The first three months of 2018 posted a 21.77% reduction in gross earnings.

The crop year for sugarcane begins every Sept. 1 and ends on Aug. 31.

Of the total sugar production of the Philippines, 93% has been allocated for the local market while 6% of this is already reserved for the US Quota, according to the Sugar Order No. 1 issued in January.

The remaining share is set for the export market.

Production already hit 1.93 million metric tons (MT) as of the week that ended last May 6. As a result, only 340,694 MTs are needed to complete the 2.27 million MT, Mr. Serafica said, citing updates provided by sugar mill factory managers in Luzon and the Visayas.

“SRA [will continue] to closely monitor the supply situation and this agency is prepared to use available means under its mandate towards stable supply and to curb speculation,” Mr. Serafica said.