Unrestrained sugar imports worry millers

July 04, 2019

The country’s sugar millers on Wednesday expressed apprehension over the planned liberalization of sugar importation to lower the price of the commodity.

“The sugar milling sector has been apprehensive for the past months because of the issue on import liberalization,” Philippine Sugar Millers Association Executive Director Jesus Barrera said in a statement.

Barrera noted that PSMA has invested billions of pesos over the years in improving their production systems and have supported the communities and people where their mills are located. The industry has also been encouraged by government through legislation like the Biofuels, Renewable Energy and the Sugar Industry Development Acts.

“And now, government wants to allow the unrestricted entry of imported sugar into our market,” he said.

Finance Secretary Carlos Dominguez III, in a press briefing during the 2019 Pre-Sona Economic and Infrastructure Forum on Monday, said that opening up the local market to more imported sugar would “probably benefit the country as a whole.” He noted the local price of sugar was double the world market price.

“Maybe we should really take a close look at who’s benefiting from the [current] restrictions here and probably the conclusion would be some kind of liberalization will actually benefit the country as a whole,” Dominguez said.

“Just compare it to Thailand where they have a healthy food processing industry. There, the price of sugar is [at the level of the] world market price even though they are also producers of sugar,” he added.

However, the sugar millers said imported sugar from the world market is priced below production cost as this was highly subsidized. “Import liberalization means that subsidized sugar produced by Indian or Thai farmer is preferred over sugar produced by Filipino farmers,” they said.

The Sugar Regulatory Administration (SRA) earlier said sugar production at the second week of June rose 0.63 percent year-on-year. SRA reported that sugar production was 2.068 million metric tons (MMT), up from 2.055 MMT the previous year.

Demand for raw sugar, however, declined 17.77 percent to 1.65 MMT. Total sugarcane milled also decreased 7.65 percent year-on-year to 21.7 MMT. Refined sugar output also fell 7.73 percent year-on-year to 784,606.8 MT.

The crop year for sugar starts in September and ends in August.