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Thursday, February 22, 2024

Gov’t to limit sugar imports in 2024

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The government plans to cap sugar imports in 2024 to 200,000 metric tons (MT) following ample shipments this year.

Agriculture Secretary Francisco Laurel said during yesterday’s confirmation hearing with the Commission on Appointments that the Department of Agriculture concurred with the initial assessment of the Sugar Regulatory Administration (SRA).

“Based on the estimates with the SRA, which we have been meeting for the last two weeks, we feel that for next year, we don’t need to import too much sugar,” he said.

The SRA confirmed that carry-over stocks from the 2022 importation would help meet local demand.

“The assessment of the industry and the DA was that importation should be about 200,000 (MT) only, assuming that we won’t have any adverse weather conditions,” Laurel said.

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The SRA said the country had ample stock of refined sugar, or about 200 percent higher than last year’s and nearly two months worth of inventory, boosted by imports of 440,00 MT sugar under Sugar Order (SO) 6.

Withdrawal from the imports, so far, amounted to 200,000, leaving a balance of 220,000 MT. About 420,000 MT from the authorized 440,00 MT imports have arrived in the Philippines. About 85 percent of the imports have been allocated to bottlers and industrial users.

In addition, about 30,000 MT from the 150,000 MT of sugar imported under SO 7 arrived in August, leaving a balance of 120,000 MT that should have been shipped by now in time for peak demand during the holidays.

According to the pre-milling estimate of the SRA, sugar output may reach 1.84 million MT in crop year (CY) 2023 to 2024, up 2.7 percent from 1.79 million MT in CY 2022 to 2023 given the mild El Niño climate.

An additional 50,000 MT of raw sugar output is expected if El Niño will not be as severe as predicted by experts, as a long dry season favors sugarcane production.

“The outlook is basically very preliminary. That is based on the area planted (to sugarcane) and based on the production average last year,” said SRA administrator and chief executive officer Pablo Luis Azcona.

He said the increase in hectares planted to sugarcane would contribute to higher yields in crop year 2023-2024, despite the closure of a sugar mill in Batangas.

The harvest, however, may decline by 10 percent to 15 percent if the dry spell worsens, Azcona said. Strong typhoons in the last quarter of 2022 and in the first half of 2023 affected the 2022 to 2023 projected output of 2.2 million MT, he added.

If El Niño becomes severe, it will adversely affect sugarcane production because the harvest season is about six to eight months from planting. Sugar cane that will be harvested in May 2024 may be affected.

The retail price of sugar has stabilized to about P85 per kilogram (kg) from an average of P110/kg. Sugar farm gate prices are estimated at P60/kg, or P3,000 per 50-kg bag.

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