Exporters are alarmed over US President Donald Trump’s imposition of a 17 percent tariff on Philippine goods, which could mean it would no longer be profitable for the country to export sugar to the United States, Administrator Pablo Luis Azcona of the Sugar Regulatory Administration said on Friday, April 4.
The Philippines that has a 143,000-metric ton share in the US Sugar Quota has allocated 66,235 MT of raw sugar for export to the United States for crop year 2024-2025, Azcona said.
The Philippines is shipping out the first half of the allocation in May and the second half in June, he said.
It is an import tariff that is being imposed so it is not certain if the new tariff will be shouldered by the US importers or it will be passed on to the Philippines exporters, Azcona said.
He said about 20 to 30 Philippines exporters are involved in the export of the 66,235 MT of raw sugar to the US.
The exporters have met with him and expressed their alarm over the tariff imposition, Azcona said.
Azcona said he wrote to Michael Ward, agricultural counselor of the Office of the Agricultural Affairs at the Embassy of the United States, on Thursday, April 2, to inquire if Philippine sugar is included in the 17 percent reciprocal tariff imposed by the US.
He informed Ward that the country is all set to start shipping out 66,235 metric tons of sugar to the US but the Philippine exporters have been calling him to clarify the recent announcement of a 17 percent US reciprocal tax.
“Is sugar included in the 17 percent reciprocal tariff? If so, is there a way to exempt sugar from the tariff, as this is a quota item?” Azcona asked Ward.
“I trust and hope you can help me on this matter,” he added.
VERY BAD, LAMATA SAYS
Manuel Lamata, United Sugar Producers Federation of the Philippines president, said the tariff imposed by Trump will have a very bad effect on the Philippine raw sugar exports to the US.
“It will carry a cost of 17 percent more so it may no longer be profitable for the traders to bring out the sugar for sale to the US, it will be too much,” Lamata said.
Lamata said the US tariff will affect the traders, but not the planters and workers.
The Philippines could sell its sugar to the world market instead of filling its share of the US sugar quota, Lamata said.
The Philippines exports sugar to reduce over supply during the peak of the milling season to prevent a drop in millgate prices, he said.
Domestic consumption of sugar is only about 180,000 metric tons a month and the country is producing 300,000 MT, Lamata pointed out.
The Philippine milling season is expected to end in the first week of June, Lamata said.
DRASTIC EFFECT ON EXPORTERS
Rep. Emilio Yulo (Neg. Occ., 5th District) said the new US tariff will have a drastic effect on Philippine sugar exports to the United States.
It was rated zero tariff but under Trump they will import a 17 percent tariff on sugar from the Philippines, Yulo said.
It will not affect the local market but it will hurt exporters, he said.
It is not just the Philippines, many other countries will be affected by the tariffs imposed by Trump, Yulo said.
Domestic millgate sugar prices at this time are still profitable to farmers, he said.*