The Sugar Regulatory Administration (SRA) will formulate programs to curb the decline in mill gate prices of sugar while increasing demand this month.
“The SRA board is looking at various programs to bring up the prices,” SRA Administrator Pablo Luis Azcona said during a press conference at the SRA office in Bacolod City earlier this week.
“The board has to decide what programs to activate before the prices go uncontrollably low,” he added.
Azcona said mill gate prices of raw sugar have dropped to as low as P2,500 per kilo.
Comfortable sugar prices for farmers will be from P2,650 to P2,700 per kilo.
“The production cost is at P2,400 per kilo or more, and we are nearing that,” Azcona said.
Farmers will not be able to recover if the sugar prices are low, besides high production costs, he added.
Azcona said the SRA had a program last crop year, where traders bought sugar from farmers and surrendered it to the agency as reserve to import at a later date to bring up mill gate prices.
The SRA can also export a limited amount of sugar to the United States to subtract from the country’s raw inventory, Azcona said, reiterating that the country has enough supply of sugar that will not warrant importation until after the harvest, which will be around May or June next year.
“There have been calls for SRA to investigate allegations of price manipulation, and although it is not within our purview, we will be looking into this as well,” he said.
Earlier, the United Sugar Producers Federation (Unifed) sought the intervention of the Department of Agriculture (DA) and SRA to arrest the drop in sugar prices.
“We urge the DA and SRA to unmask the culprits who are playing us,” Unifed president Manuel Lamata said in a statement in November.
Mill prices of sugar averaged at P2,500 per bag on November 28, at a time when farmers hoped that prices would be at P2,800 per bag to make a little profit.
Lamata said the drop in milling prices averaged P100 for every 50-kilogram bag of sugar.
The Unifed suspected that “artificial pricing is caused by traders who want to make a big profit at the expense of sugar farmers, and they should be exposed.”
Lamata added that while mill prices are dropping, retail prices remain constant and will probably even hike due to the holidays, which means more profit for them.
“We need them to prop up sugar prices at a comfortable level to prevent further losses, especially now when there is also the issue of sugar purity that has gone down due to the long drought,” he said.
Since the start of the milling season, prices have been erratically dipping and increasing, contrary to the supply and demand figures, which raised suspicions that somebody is profiting from recent events, the Unifed said./WDJ