THE Sugar Regulatory Administration (SRA) is seeking a bilateral deal to export sugar to China without import duties in exchange for the continued duty-free import of high-fructose corn syrup (HFCS), a sweetener used by the food industry.
“We wanted to ask DTI [Department of Trade and Industry] to help us to seek a bilateral with China; we want free access to their sugar market in exchange for free access of HFCS here,” SRA Administrator Rosario Anna V. Paner told reporters last week in Quezon City.
Sugar is currently levied an import duty of 15% in China, the world’s top sugar importer.
HFCS from China — a major corn producer is currently not charged a tariff.
“They are also protective like any other country… If they flood us with HFCS, I don’t think they will readily agree to take our sugar. The Philippines is very small but we want to expand our markets to China,” she added.
Ms. Paner also added that meetings with ASEAN members can also set up the stage for discussions on pushing the interests of sugar-producing countries including the extraction of concessions from China.
Some 150,000 metric tons (MT) of HFCS have been shipped to the country this year, more than half the estimated 373,000 MT total in 2016.
Of this volume, Coca-cola FEMSA Philippines, Inc., the local arm of Mexico’s FEMSA, the largest franchised company bottling Coca-Cola products, imported 135,000 MT.
Ms. Paner noted that the firm’s sugar purchase has increased to two million bags, as committed, from the previous year’s level of one million bags.
“So based on our calculations on their use of HFCS and sugar, they’re at 60:40 whereas before it was 90:10. So in a matter of a few months they were able to adjust,” she added.
The heavy use of HFCS by food manufacturers has depressed domestic prices of sugar, generating complaints from the sugar industry. In response, the SRA has sought the power to regulate the entry of HFCS to 187,000 MT of shipments per annum, citing its mandate to protect the sugar industry. — Janina C. Lim
