By Dominique Gabriel G. Bañaga
The National Federation of Sugarcane Planters (NFSP) has sought the help of the Department of Agriculture (DA) to address the declining sugar prices and other issues that confront the sugar industry.
NFSP president Enrique Rojas and other sugar industry leaders, during a meeting in Metro Manila on Tuesday, January 9, requested DA Secretary Francisco Tiu Laurel for government intervention to address the factors causing the drop in sugar prices.
Rojas said current prices — P2,400 to P2,500 per bag — are a far cry compared to last crop year, when prices were at P3,000 per bag, lower by at least P600 to P500.
“The prevailing sugar prices can hardly compensate for the hard work, financial investments and the risks taken by farmers to produce their crop,” Rojas said.
He said the NFSP, the majority of which are small farmers, has to do something to protect them from the “almost disastrous” price levels.
Data from the Sugar Regulatory Administration (SRA) show that the majority of refined sugar withdrawals are imported, while only a small portion of withdrawals are domestic sugar.
The ratio in the withdrawals between imported and domestic sugar was 70 to 30 percent in favor of the imported commodity.
Rojas explained that the abundance and preference for imported sugar has dampened the demand for raw sugar, which caused a drop in prices.
“Unless this over importation issue is addressed, farmers will continue to suffer from low sugar prices, and the government should intervene to ensure that this does not happen again,” Rojas said.
The NFSP president said Laurel was receptive to the industry’s concerns.
He added that Laurel, being a businessman himself, understood the plight of the sugar farmers, and promised that his office would come up with a concrete proposal that he would discuss with the sugar leaders and the SRA during their next meeting.
Rojas and other sugar leaders recommended a conservative figure of approximately 250,000 to 300,000 metric tons (MT) when SRA was planning to import sugar last crop year.
However, SRA decided to import 440,000 MT, followed by the almost 64,000 MT importation under the Minimum Access Volume, and added another 150,000 MT importation.
Rojas said that over importation, coupled with the bad timing of the arrival of the imports during the milling season, caused the drop in sugar prices, which greatly harmed the sugar farmers.
Earlier, SRA head Pablo Luis Azcona said there is no apparent need to import sugar at the moment, based on the current demand figures.
According to Azcona, they will be able to figure out the final demand numbers after the milling season.
“In the meantime, we are still milling, we have ample buffer stock, we have ample supply, [but] demand is lower than expected, so there is no need to do so at the moment,” he explained.
Azcona said the drop in farm gate price is based on market forces, stating that if there is an oversupply of sugar, the retail prices should have dropped also.
“How come it is not dropping? Only the people in the trading side could explain it,” Azcona said.
He said they have assured consumers of stable supply, especially this month.
The SRA head added that the import programs are all based on available numbers.
“So if you look at Sugar Order No. 6 issued in February [last year, and] if you look at our January numbers, we really need to import. If you look at our numbers, we were supposedly running short, so we needed to import,” Azcona said.
Azcona said he has recently met with sugar traders, and they were unable to explain why they are always claiming that the market is “weak” even if there is an oversupply or undersupply of sugar.
“Maskin pila ang presyo i-drop mo, wala gid ya,” Azcona said./DGB, WDJ