Pinoy sugar industry gets sweet on stable prices, polls

MANILA: Even with the expected surplus of sugar in world supply this year, the Philippines is set to experience strong demand for the commodity, owing to stable prices, increasing exports, and more spending during the midterm elections in May.

The expected surplus—due to favourable crushing and weather conditions in some of the major sugar-producing countries like Brazil, India, and Thailand—would naturally put pressure on sugar prices, according to the Sugar Regulatory Administration (SRA).

But the regulatory body, which is based in central Philippines and mandated to promote the growth of the country’s sugar industry, stressed that domestic prices will continue to be stable based on price movements over the past months.

In a statement released on January 3, SRA Administrator Maria Regina Bautista-Martin stressed the need for the sugar industry to “increase productivity and reduce the cost of production”, especially that import tariff was set to hit 18 percent starting from January 1.

“[W]e need to be vigilant in assessing the impact of world market situation on local prices,” she said.

She expressed confidence that the sugar industry will continue to earn dollars for the Philippines, as the export of the commodity to the United States and other foreign markets continues.

Shipments under the US Quota programme was set to start this month, she said, while exports to other parts of the world have already reached over 20,000 metric tonnes.

Ms. Bautista-Martin said the SRA stands pat on its sugar production forecast of 2.356 million metric tonnes for CY, or crop year, 2012/13, stressing that production for the current CY has reached 872,978.87 metric tonnes, or 37.048 percent of the forecast, as at weekending December 16, 2012.

This translates to 27.19 percent higher compared with the same period in the previous CY, she added, owing to early milling, higher rate of crushing, and favourable weather condition in the sugar producing regions of central and southern Philippines during the last quarter of 2012.

She also cited SRA records indicating higher sugar withdrawals for domestic demand compared with the previous CY level at 28.61 percent for raw sugar and 22.8 percent for refined sugar.

SRA’s optimism is also fuelled by the May 13 Philippine General Election, where voters will elect candidates to 18,022 national and local positions in Congress, the provinces, municipalities, and the Autonomous Region in Muslim Mindanao.

Ms Bautista-Martin said that demand for sugar needed for food and drinks is seen to increase during the election period, starting from when political candidates and their supporters stomp for their campaigns and until the winners are sworn into office.

(Home page image courtesy Shutterstock)

Follow Emirates 24|7 on Google News.