August 23, 2022

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SRA board wants all sugar production for domestic use

THE SUGAR Regulatory Administration (SRA) board wants all sugar output in the coming crop year to be allocated for domestic use, amid elevated prices of sugar due to a supply shortage.

“We were directed (by President Ferdinand R. Marcos, Jr.) to immediately come up with Sugar Order (SO) No. 1 regarding sugar allocation, of which the sugar board recommended that all sugar for this crop year will be classified as ‘B’ sugar or domestic sugar,” acting SRA Administrator David John Thaddeus P. Alba said in a statement on Tuesday.

The new crop year for the sugar industry will start in September.

Mr. Alba also said none of the raw sugar production will be classified as “A,” which is designated for the United States.

“There will be no allocation for the US quota,” he said.

The United States imports from raw cane sugar from countries like the Philippines and Brazil under the tariff rate quota (TRQ) scheme of the World Trade Organization. The TRQ sets a volume limit for goods which can enter the US at a lower tariff.

Mr. Alba said the SRA board’s recommendations will be “subjected to thorough consultation with all industry stakeholders.”

The SRA board, which is headed by Mr. Marcos as Agriculture secretary, is also working on the order that will allow the importation of sugar.

“We also came up with Sugar Order No. 2 which recommends the importation of 150,000 metric tons (MT) of refined sugar. While in principle this has been approved, we still need to draw up the mechanics covering this order after consultations as well,” Mr. Alba said.

Mr. Marcos on Saturday named Mr. Alba as acting SRA administrator, replacing Hermenegildo R. Serafica, who resigned along with other board officials after the agency approved an order allowing the importation of 300,000 MT of sugar, which Mr. Marcos’ office considered as “illegal” or “unauthorized.”

The SRA board now includes Pablo Luis S. Azcona, who represents sugar planters, and Mitzi V. Mangwag, who represents sugar millers.

As of Aug. 12, the average price of refined sugar in wet markets rose by 82.9% to P96.93 from P53.00 from the year before. The prices of raw sugar climbed by 59.3% to P72.14 from P45.29 in 2021.

According to earlier estimates by the SRA, raw sugar production in the crop year ending Aug. 31 is expected to reach 1.8 million MT, 16% lower from a year ago.

PREMIUM SUGAR
In the same statement, Mr. Alba acknowledged the shortage in refined sugar used by the beverage industry.

“We are currently consolidating the data as to how much is really needed so we can recommend the necessary actions we need to take to Mr. Marcos,” he said.

Beverage manufacturers, including Coca-Cola Beverages Philippines, Inc., Pepsi-Cola Products Philippines, Inc., and ARC Refreshments Corp. earlier announced that they are facing a shortage of premium refined sugar.

Coca-Cola also issued a separate statement saying that the local food and beverage industry will require at least 450,000 MT of premium refined sugar for continued production.

“However, while we know that Coca-Cola is in a critical place in their sugar needs, we would like to emphasize that Pepsi and RC Cola still have their available supply as per our records,” Mr. Alba said.

“The sugar board just took office and we ask our industry partners to indulge us with some time so we can address this issue based on established facts,” he added. — L.M.J.C.Jocson