Scrap ‘A’ sugar allocation, industry leaders urge SRA

Sugar leaders Friday, March 26, called for the immediate scrapping of the country’s “A” sugar allocation to fill its United States quota with the drop in domestic production this crop year.

Manuel Lamata, president of the United Sugar Producers Federation of the Philippines, said UNIFED is calling on the Sugar Regulatory Administration and Department of Agriculture to stop issuing “A” quedans for the export of the country’s sugar to the United States in lieu of the shortfall in local production because of too much rain.

“We also want to address the rising prices of local sugar which our consumers do not like,” he said.

Raymond Montinola, president of the Confederation of Sugar Producers Associations Inc., in a letter to SRA Administrator Hermenegildo Serafica, made a similar appeal.

Sugar recovery has dropped significantly compared to last year, leading SRA to revise its crop estimate for Crop Year 2020-2021, he said.

In anticipation of a tightness in the domestic supply of sugar, he said CONFED supports SRA’s effort to review the current sugar allocation formula.

CONFED has recommended the termination of the 7 percent allocation for the country’s sugar produced for the U.S. quota effective at the earliest possible time, he said.

“This, we believe would help relieve the tightness in our domestic market,” he said.

CONFED also proposed that SRA establish a deadline for verification and shipment to the U.S. market of all “A” sugar already quedanned, Montinola said.

Enrique Rojas, president of the National Federation of Sugarcane Planters, said Serafica informed him that the country’s sugar production might drop by more than 100,000 metric tons this crop year.

Rojas said the NFSP has recommended to Serafica that the country’s allocation for “A” sugar be immediately scrapped, and that 100 percent of forthcoming sugar production be classified for the domestic market.

“We are already more than half way in the crop year and we have stockpiled sufficient supply of ‘A’ sugar to fulfill our commitment to the US market,” he added.

Rojas said he also asked the SRA head to closely study the projected consumption, considering the drop in demand because of the COVID pandemic.

“Once we already have a clear picture of the projected demand, we should also conduct a rigid inventory of actual sugar stocks to determine if we really have a supply shortage, and we can ascertain the exact volume of the projected shortage,” Rojas said.

If importation is really necessary then we will know how much to import, he added.

All stakeholders, particularly the planters, should be consulted on the volume of importation and the timing of its arrival, so that it will not adversely affect millgate prices, Rojas said.

“If ever we need to import, it should be after the close of the milling season,” he added.*

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