Philippines President Ferdinand Marcos Jr. has approved the import of 150,000 Metric Tonnes of sugar to address the shortage of supply and curb rising prices in the country. According to Sugar Order No. 2, posted on the Philippines’ Sugar Regulatory Administration (SRA) website, half of the total import volume, or 75,000 MT, would be allocated to industrial users or companies using sugar in their manufacturing process, while the other half would be given to consumers or the market.
The Philippines is not a regular importer of sugar and imports only when the need arises. Amid a poor harvest this year, there has been a shortage of supply of sugar in the domestic market which has opened up new opportunities for Bulk Sugar Exporters around the world. According to Sugar Regulatory Administration (SRA) data, there has been a decline in the sugar output for the 2021-22 crop year. Till June 15 of this year, the Philippines only recorded a production of 1.8 million tonnes in contrast to the 2.21 million tonnes last year. The unusual decline is attributed to the onslaught of Typhoon Rai (Odette) which damaged the sugarcane crop of this season. This has led to an inevitable price increase of the commodity in the country.
“After due consultation, the Stakeholders of the Sugar Industry have submitted their respective positions and letters of endorsement recognizing the need for an importation program for the crop year 2022 to 2023,” the order signed by Marcos dated September 13 said. “After taking into consideration all comments, inputs, and information, the SRA deems it necessary to adopt additional, responsive, and pre-emptive measures to ensure domestic supply and manage sugar prices in order to achieve the foregoing policy declarations through timely government intervention by way of importation in order to maintain a balanced supply and demand of sugar for domestic consumption,” it added.*
Suspicions of Hoarding
As the SRA is waiting on the applications for the importation of sugar, the administration is putting the onus of sugar shortage on traders who have hoarded their sugar stocks. United Sugar Producers Federation President Manuel Lamata, insisted that unspecified traders are engaged in “manipulation and hoarding” and claimed that there is no shortage at all.** There were raids in multiple locations in August 2022, which yielded 10,700 million tonnes from which the Philippine government concluded that the shortage is ‘made-up’. Panels in both the House of Representatives and the Senate are currently investigating the issue. After the revelation of an attempt to import sugar, there have been assessments that the shortage may be artificial, considering that some inspections have shown sugar being stocked in warehouses.
There’s no doubt that there has been a decrease in sugarcane production in major sugar-producing countries in the last three years which has significantly affected the global sugar trade. The Philippines though was pretty much self-reliant when it came to its sucrose needs. However, the country this year witnessed an acute crisis of sugar creating troubles for the locals and food industries but opportunities for Bulk Sugar Suppliers across the world.
Sources: *Sugar Regulatory Administration, **BusinessWorld