The Sugar Regulatory Administration board is coming up with programs this December to curb the downward spiral in millgate sugar prices, SRA Administrator Pablo Luis Azcona said on Thursday, Dec. 5.
“This December the board has to decide what programs to activate before the prices go uncontrollably low,” he said at a press conference at the SRA office in Bacolod City.
He said millgate prices of raw sugar have dropped to as low as P2,500 per Lkg but comfortable prices for farmers would be P2,650 to P2,700 per Lkg.
Farmers are coming in with a high cost of production, they will not be able to recover if the prices do not go up, Azcona said.
“Small farmers’ production cost is at P2,400 per Lkg or more and we are nearing that,” he said.
SRA has to come up with programs to increase demand and prices, he said.
Sugar farmers groups nationwide are calling for immediate government intervention to arrest the drop in sugar prices.
The Luzon Federation of Sugarcane Growers called on SRA to take a direct hand in arresting the precipitous decline in the price of locally produced sugar.
“While official figures show stability in supply, we are concerned that prices have decreased considerably while retail market prices show no appreciable and proportionate decline,” LuzonFed president Cornelio Toreja said in a letter to Azcona.
“This shows a clear manipulation in the supply and demand chain, which necessitates a firm and decisive government hand,” he added.
“If price manipulation continues and production cost recovery is uncertain, this will just add to the various factors contributing to the decline of our industry,” Toreja said.
Manuel Antonio Zubiri, president of the Sugarcane Growers Association of Bukidnon, in a letter to Agriculture Secretary Francisco Tiu Laurel Jr. and Azcona, also called for urgent government action on the low buying prices of sugar traders.
“This decline has not been reflected in retail prices, raising concerns about possible market manipulation. This situation demands immediate government action to correct the imbalance,” Zubiri said.
This issue is particularly critical for the small sugarcane farmers, whose livelihoods depend on fair market practices, he said.
The Jalasig Sugarcane Planters Association in Passi, Iloilo, said “the time for vague assurances and delayed action is over. If this trend continues unchecked, the consequences will be catastrophic not just for the farmers but also for the economy at large”.
It called for prompt action and concrete answers.
The SRA board is looking at various programs to bring up the prices, Azcona said.
To bring up millgate prices the SRA last crop year had a program where traders bought sugar from the farmers and surrendered it to SRA as reserve, in exchange for priority to import at a later date, Azcona said.
The SRA can also export a limited amount of sugar to the US to subtract from the country’s raw inventory, he said.
“There have been calls for SRA to investigate allegations of price manipulation and although it is not within our purview, we will be looking into this as well,” he also said.
Azcona also reiterated that the country has enough supply of sugar that will not warrant importation until after the harvest, which will be around May or June next year.
Reports from the field show that sugar production this year will drop to around 1.6 million metric tons, he said.*