THE Department of Agriculture (DA) said the Sugar Regulatory Administration (SRA) has not issued any import clearance for sugar imports under its replenishment program amid reports that some traders are using the mechanism to smuggle the sweetener.
In a report to Agriculture Secretary William D. Dar, SRA Administrator Hermenegildo R. Serafica said the SRA has not issued any import clearances to qualified traders under the replenishment program.
Under such program, only traders who have exported to the United States in the current crop year 2020-2021 could apply to import sugar in a 1:1 ratio.
“Any trader who will be importing sugar will need to secure an import permit from SRA,” Serafica said in his report to Dar, a copy of which was obtained by the BusinessMirror.
“All the traders that exported to the US are accredited with SRA. Their exports and imports, if any, are strictly monitored,” Serafica added.
The SRA, an attached government-owned and -controlled corporation to the DA, has a standing memorandum of agreement with the Bureau of Customs (BOC) covering any importation of sugar in the country, based on Serafica’s report.
“Customs will always look for SRA import clearance and all import clearances that traders present to Customs are verified with SRA by the Customs before they release the imported sugar from the ports,” he said.
“If there is no SRA clearance to import, these sugar are confiscated by customs,” he added.
The sugar replenishment program officially started last July 1 and shipments under the program must arrive no later than October 31. Imports under the replenishment program would be initially classified as “C” or reserve until the importer requests for reclassification of the concerned shipments.
Reclassification of “C” sugar requires a formal written request to the SRA board, which has the authority to approve such matter based on existing rules and regulations.
Sources told the BusinessMirror that no party has applied to date for reclassification of “C” sugar to “B” sugar.
In a statement on Monday, the Department of Finance (DOF) directed the BOC to sniff out sugar smuggling following reports that certain traders are exceeding their allowed import volume under the SRA’s export replenishment program.
Customs Commissioner Rey Leonardo B. Guerrero was informed that the DOF has received reports from Bureau of Internal Revenue (BIR) officials in Cebu that a company authorized to export sugar has been “shrewdly” replenishing the shipments of sugar it sent overseas by importing more than the volume it had exported.
“Please keep an eye on those gaps,” Finance Secretary Carlos G. Dominguez III told Guerrero at a recent DOF Executive Committee meeting.
Dominguez, who was a former agriculture secretary under the administration of former President Corazon Aquino, said at the meeting that the sugar price domestically is much higher than the world market price. “So there is going to be an incentive for people to smuggle in sugar,” he said.
The Philippine Sugar Millers Association (PSMA) welcomed Dominguez’s statement, noting that his directive would ensure that sugar imports are consistent with government rules on the ongoing replenishment program.
“The directive will ensure that the imports that come in as replenishment will be consistent with the program of SRA under Sugar Order #3 series of 2020-21, that exporters of the A sugar/quedans are allowed to bring in the sugar and corresponding to the volume that they exported to the US quota,” PSMA Executive Director Jesus L. Barrera told the BusinessMirror via SMS.