Sugar producers see imports for years on weak domestic output

SUGAR FARMERS said they expect imports of the commodity to continue for years due to weak domestic production and the persistence of high input costs.

Rafael L. Coscolluela, an adviser to the Confederation of Sugarcane Farmers said on BusinessWorld Live on One News channel on Tuesday that the industry is facing challenges like high fuel prices and the decline in land area planted to sugar.

“We do have a lot of work cut out for us. The reality is that over next several years, we are going to have to import sugar,” Mr. Coscolluela said.

“We’ve lost 25,000 hectares that were planted to sugarcane before. These 25,000 hectares have been converted to commercial or residential purposes or other crops. That’s a large percentage of sugar area that we’ve lost. We have seen a drop in productivity,” he added.

Mr. Coscolluela said the weather has also had an impact.

“Last year, we averaged about 60 tons per hectare, in comparison to the industry’s self-declared goal of 75 tons per hectare. There are many reasons for that drop in productivity. One is the weather. Weather has become very unpredictable. We’ve had to mill cane during the rainy season and that is bad for the crop,” Mr. Coscolluela said.

According to Mr. Coscolluela, “If we want to drive sugar production up within the next few years, we will have to take drastic measures…We will need concerted effort between the private sector and government. So far, we have not heard too much in terms of details about what the government proposes to do to reduce cost of fertilizer and fuel,” Mr. Coscolluela said.

Mr. Coscolluela said the inventory of sugar is sufficient for the next few months following the recent import orders issued by the Sugar Regulatory Administration (SRA). 

“We’ve had two sugar orders that authorized sugar imports. The first was Sugar Order No. 3 last crop year (2021-2022) which authorized imports of 200,000 metric tons (MT),” he said, adding that this volume has not yet been filled by importers.

“The second order is Sugar Order No. 2 of the current crop year (2022-2023), which authorizes imports of 150,000 MT,” Mr. Coscolluela said.

“Given the peaking of milling season at this time, the figures tell us that there will be adequate sugar for the next several months. Having said that, we do have to take a close look at the sugar supply-demand situation sometime in April up to end of milling season or August of next year because estimated production is about 1.9 million MT while estimated demand is 2.4 million MT. That’s a shortfall that we’ll have to fill,” he added.

The SRA has announced an initiative to sell sugar at P70 per kilogram at its offices in Quezon City and Bacolod City, and in Kadiwa rolling stores.

The Agriculture department said refined sugar sold in Metro Manila wet markets on Tuesday fetches P100/kg, down from P105/kg a day earlier. — Revin Mikhael D. Ochave