PHL to resume sugar exports to US

The Philippines will resume exports of raw sugar to the United States amid an increase in domestic production this year, the Sugar Regulatory Administration (SRA) said in an order.

In Sugar Order No. 3 dated July 26, the SRA said the Philippines will ship 25,300 metric tons (MT) of raw sugar to the United States to fulfill the sugar quota allocation for 2024.

“The intention of this voluntary US export of 25,300 MT of locally produced raw sugar is to allow the Philippines to fulfill, after noncompliance of more than three years, its obligations under the significantly reduced US Raw Sugar Tariff-Rate Quota World Trade Allocation,” the SRA said in the order.

The Philippines last shipped raw sugar, totaling 112,008 MT, to the US during the 2020-2021 crop year. Since then, the country has not exported raw sugar to the US due to domestic supply concerns.

Last May, the US had granted the Philippines’ request for a reallocation of the quota for crop year 2023-2024, with a volume of 25,300 MT.

“The current total production of locally produced sugar for crop year 2023-2024 has exceeded 1,920,000 MT, thereby exceeding the previous crop year’s total production by more than 120,000 MT, and likewise allowing the Philippines to fulfill its US quota allocation of 25,300 MT,” the SRA said.

The country exports raw sugar to the US to stabilize prices during times of overproduction in local sugar mills.

According to the SRA, the eligible participants in the export program are those who have purchased raw sugar from local farmers at a premium price to stabilize millgate prices.

SRA Administrator Pablo Luis S. Azcona had said that the regulator would allow the export of raw cane sugar to the US by August. The Philippines has until Sept. 30 to fulfill its quota during the current crop year.

Asked to comment, United Sugar Producers Federation of the Philippines President Manuel R. Lamata said that the export would help stabilize the millgate prices of sugar.

“This sugar, if exported in the months of December to January, will decongest our local sugar stocks thereby maintaining a stable price for our millgate sugar,” he said in a Viber message.

He noted that millgate prices have dropped due to the excess supply of sugar.

During the current crop year raw sugar stocks rose by 35.5% year on year to 374,474 MT as of July 7.

“What is important for us planters are stable millgate prices from start to finish. Thereby managing stock to ensure high prices all season round is important,” Mr. Lamata said.

Mr. Lamata added that stocks would be replenished with the approval of the importation of refined sugar during the off-milling season.

“We are going to import refined sugar during the end of milling season to replenish what the country needs,” he said.

Earlier, Agriculture Secretary Francisco P. Tiu Laurel, Jr. said that the department is planning to import refined sugar to bolster local supply during the end of the local milling season.

The SRA’s order allows exporters of raw sugar to the US to import refined sugar in approved volumes to replenish sugar stocks.

Meanwhile, the Sugar Council — a group composed of three planter federations — said that the export plan may not offer any benefit for local producers.

“We cannot readily accept the premise that the Philippines is obliged to fill whatever US quota it is granted, especially when domestic supply situation will necessitate an importation program,” the group said in a letter to Mr. Tiu Laurel dated July 8.

The letter was signed by the Confederation of Sugar Producers Associations, Inc., the National Federation of Sugarcane Planters, Inc., and the Panay Federation of Sugarcane Farmers, Inc. and addressed to the President and Agriculture Secretary.

The group added that any importation program should be based on “a trigger point, data-based, carefully calibrated, and decided in a transparent manner immune from manipulation or cartelization.” – Adrian H. Halili, Reporter