THE country may stand to lose substantial investments if the government allows the entry of “subsidized” sugar abroad, according to the Philippine Sugar Millers Association Inc. (PSMA).
PSMA Executive Director Cocoy Barrera told the BusinessMirror that sugar millers are “very concerned” with the recent statement of Budget Secretary Benjamin E. Diokno that the government wants to “deregulate” the industry within the year.
“Our efforts [in growing the economy] are being disregarded in the statement. If you liberalize the industry by importing substantial volume of subsidized sugar, then you’re sweeping aside the farmers, the workers and the investments made toward [the sector’s growth]. There will be definitely some detrimental effects to the industry,” he said in an interview.
“We are going to ethanol and [power] cogeneration. Those investments are not minuscule, these are tens and hundreds of millions—and all of these are dependent on sugar production. We will lose them—not only sugar, not only milling—but also other allied sectors,” he added.
Diokno recently issued a statement that the government is planning to liberalize the sugar industry by opening the sector further to imports. Diokno argued that locally produced sugar is “very expensive” compared to those produced abroad.
However, Barrera explained that the government has already “relaxed” some importation measures relating to the sugar industry, such as the application of importers and traders.
Furthermore, he added that it would be “unreasonable” and “unwise” for the government to allow importation of sugar when the local sector is at its peak of its milling season as it would flood the market with supply and result in lower farm-gate prices.
Two of the Sugar Regulatory Administration (SRA) board members said over the weekend that the farm-gate price of sugar went down immediately after Diokno made his pronouncement during a news briefing last week.
The board members Roland Beltran, who represents the milling sector, and Dino Yulo, who represents the planters’ sector, noted that the drop in prices came at a wrong time as the industry enters the peak of its milling season.
They argued that the farm-gate price of sugar has significantly dropped from P1,693 per 50-kilogram bag in September to P1,575 per bag as of January 6. With this, the they pointed out that the “high retail prices of refined sugar is not attributable to sugar farmers and millers.”
“The sugar industry—its farmers, mill and workers, are partners of the government for development. They provide investment, employment and revenue in the countryside. It is unfair to subject them to this insecurity,” they said.
In a separate statement recently, Yulo urged the Department of Trade and Industry “to help monitor and curb sugar prices in the market because of the great disparity between the retail prices of sugar and mill-gate prices.”
“Open-direct importation is not the solution. Let’s go after the greedy traders and retailers who are capitalizing on the situation at the expense of the sugar farmers and producers,” he said.