Government eyes ways to temper rising sugar prices
THE government is currently exploring a number of options, including the importation of more sugar, to temper the rise in sugar prices, a senior Department of Agriculture (DA) official said Monday.
Agriculture Undersecretary-designate Kristine Y. Evangelista said the government wants to ensure that households will have access to cheaper sugar.
“The importation of sugar is something the SRA [Sugar Regulatory Administration] is looking into, but we [may] have to come up with a new order to ensure our consumers will have access to cheaper sugar,” Evangelista told reporters in an interview in Quezon City.
She also said the government is currently looking into the cost structure of producing sugar and is evaluating the necessity of adjusting the suggested retail price (SRP) for the sweetener.
Based on the list issued by the DA last February 20, the agency recommended an SRP of P50 per kilogram for refined sugar and P45 per kg for raw sugar.
The figures are much lower than the average retail prices of raw and refined sugar as of July 8. Data from the SRA indicated that supermarkets and wet markets in Metro Manila sold refined sugar for P81.90 per kg and P87.50 per kg, respectively. SRA also said the price of raw sugar sold by supermarkets and wet markets averaged P63.55 per kg and P66.86 per kg, respectively.
The BusinessMirror reported last month that the country’s sugar stocks will be depleted by August as demand for the sweetener has outpaced supply due to lower cane production and the delay in import arrivals.
Calculations made by the DA and the SRA showed that the country will run out of refined sugar as early as the last week of July. (Related story: https://businessmirror.com.ph/2022/06/29/phl-may-run-out-of-sugar-by-august-sra/).
Agriculture Undersecretary Fermin D. Adriano said the computation made by the DA’s economic team showed a sugar supply deficit of 203,000 MT and a refined sugar shortfall of about 332,000 MT.
SRA Administrator Hermenegildo R. Serafica said the country is already “eating up” its sugar buffer stock.
Because of this, Serafica said the country will not have any carryover stocks of sugar at the start of the next crop year on September 1.
“That is why there should be carryover sugar stocks at the end of each milling period. But this time, as it is, we won’t have any carryover stocks,” he said in a statement.
Historically and ideally, Serafica said the country must have carryover stocks of 250,000 MT raw sugar and 200,000 MT to 250,000-MT refined sugar at the end of any given crop year.
“Unfortunately, what is happening is even our carryover stocks from last year are [running out]. So we are now already consuming what would have been our buffer stock because our imports were delayed,” he said.
Serafica said one of the options of the government to plug the shortfall in domestic sugar supply is to import since it will take time to build up stocks from local sources. He noted that the milling of raw sugar starts in December and peaks in the first quarter of the succeeding year, while refined sugar production begins once there is an ample supply of raw sugar.
“If we rely on our local production alone and not allow importation, by August we won’t have enough sugar and we won’t have any carryover stocks for our needs in the coming months until production builds up,” he said.