Amid rising prices, SRA orders transfer of all unshipped sugar to domestic use

As the escalating sugar prices started to cause alarm among local producers and millers, the Sugar Regulatory Administration (SRA) was prompted to issue another order that will convert all the unshipped sugar supposedly for world market exports to domestic use.

In other words, the country will no longer ship even a single ton to other markets, except the United States, for this crop year.

"We are calling for the immediate conversion of all remaining and unshipped 'D' sugar to 'B' sugar with conversion rights to producers to help address the surge in 'B' sugar prices," a group of producers and millers said in a letter to SRA.

'D' sugar is the portion of the country's sugar production meant to be exported to world markets, while 'B' sugar is solely for domestic use. "We are already alarmed by the way 'B' or Domestic sugar prices have escalated. As of this week, prices are averaging R1,750.00 per bag, with no signs of abating. Almost all sugar producers will agree that this price level is no longer conducive or sustainable for the industry," the group said.

The letter was sent to SRA by Jose Mari L. Chan, president of Binalbagan-Isabela Sugar Company, Inc.; Manuel A. Lamata, president of United Sugar Producers’ Federation of the Philippines, Inc.; Renato P.

Cabati, president of Philippine Association of Sugar Refineries, Inc.; Enrique D. Rojas, president of National Federation of Sugarcane Planters, Inc.; and Danilo Abelita president of Panay Federation of Sugarcane Farmers, Inc.

Based on the Visayas Average Bid Prices for the production week-ending May 13, the price of B sugar jumped by 26.10 percent to R1,765 per 50-kilo bag from R1,400.47 in the last crop year. This is also higher by 2.39 percent from the previous week's price of R1724.69.

According to the sugar group, if the price will continue to increase, it will be "disastrous for the industry and all its stakeholders perhaps for years to come."

"We ourselves are sugar planters and millers and have been with the industry for decades. And based on experience, we can say for certain that if these prices persist, or worse climb further, we can expect a backlash from our consumers and over-reaction from the national government," the group said.

"Households will reduce their sugar consumption, while our institutional and industrial consumers will reformulate their products by using less sugar or more alternative sweeteners," it added.

SRA Board Member Roland Beltran admitted that despite SRA's assurance that there will be enough sugar for this crop year, prices has still "unreasonably increased to the detriment of the consuming public."

"Sugar production is not so good especially in Mindanao area. We may be able to barely hit our projection of 2.27 metric tons [MT]," Beltran said.

A crop year begins on September 1 and ends August 31 of the following year.

As a response, SRA, through Sugar Order No. 9, ordered the reclassification of the remaining D Sugar or World Market Sugar for this current crop year into B or Domestic Sugar.

"It is the national interest to institute measures that will bring about stabilized prices of B Domestic Sugar which are reasonably profitable to producers and fair to consumers," SRA said.