BACOLOD City — Sugar industry stakeholders have reached a consensus to classify all locally produced sugar for domestic consumption this crop year amid a projected decline in production to 1.66 million metric tons (MT), according to the Sugar Regulatory Administration (SRA).
The consensus was reached during a hybrid consultative meeting recently hosted by the Philippine Sugar Millers Association in Makati City, where representatives of sugar federations, millers, refiners and traders discussed the classification of sugar ahead of the issuance of Sugar Order (SO) No. 1.
The stakeholders agreed to recommend that 100 percent of locally produced sugar be classified as “B” sugar, or sugar intended for the domestic market.
SO No. 1 sets the classification and allocation of locally produced sugar at the start of the milling season.
SRA Administrator Pablo Luis Azcona said it had been a long time since representatives from various sectors of the sugar industry gathered to discuss an issue and arrive at a common position.
“I hope we can make this a regular process of consulting each other. After all, we all want what’s best for our industry,” Azcona said.
The meeting was held amid proposals from some sugar groups and traders to allocate between 4% and 10% of production as “A” sugar, or sugar intended for the United States quota.
Azcona said the SRA had received a request from the United States Department of Agriculture to fill the country’s US sugar quota with 147,000 MT.
However, stakeholders opposed to an “A” allocation pointed to the projected production shortfall this crop year, which they attributed partly to the effects of red-striped soft scale insect (RSSI) infestation and El Niño.
Domestic production is expected to fall to 1.66 million MT from 1.85 million MT last crop year.
With supply expected to remain tight, most stakeholders said allocating sugar for export to the US market could be difficult to justify to local sugar producers and consumers.
Some traders and sugar federations, however, argued that allocating 4% to 6% of production for the US market could benefit farmers by creating additional demand and potentially pushing domestic sugar prices higher.
Luzon Federation of Sugarcane Growers (LuzonFed) President Cornelio Toreja said fulfilling the country’s US sugar commitment could still be considered if the price offered by the US market would be favorable to local producers.
Toreja, however, said his group would respect the majority position supporting an all-“B” classification.
“We will abide by the majority,” Toreja said after the consensus was reached.
The Confederation of Sugar Producers Associations Inc. (CONFED), represented by President Aurelio Valderrama, former Negros Occidental Gov. Rafael Coscolluela and former EB Magalona Mayor Alfonso Gamboa, supported the all-“B” classification.
The National Federation of Sugarcane Planters, led by President Enrique Rojas, as well as Danny Abelita of PanayFed and former congressman Manuel Zubiri of the Mindanao Federation of Sugarcane Planters, also expressed support for allocating all production to the domestic market.
The United Federation of Sugar Producers (UNIFED), represented by Antonio Ramos and Julian Garcia, likewise joined the consensus and expressed hope that the milling season would begin with favorable sugar prices.
Azcona welcomed the consensus-building process and said the SRA would continue consulting industry stakeholders as market conditions and production figures develop.
He proposed another meeting next month to reassess sugar prices and determine whether the projected production figures are being validated./PN
