The Philippines may need to import more refined sugar in the current crop year, as previous rounds have been “unsuccessful” in pulling down retail prices of the sweetener, an international agency said.
The United States Department of Agriculture-Foreign Agricultural Service in Manila (USDA-FAS Manila) said the Philippines’s refined sugar imports in crop year 2023-2024 would reach 257,000 metric tons (MT).
The volume, the USDA-FAS Manila explained, already includes the 150,000 MT authorized volume under Sugar Order (SO) 7 of crop year 2022-2023.
This means that the Philippines may allow the entry of an additional 90,000 MT in the current crop year, which would end on August 31 of next year.
Meanwhile, the USDA-FAS Manila does not see the Philippines importing a single volume of raw sugar in the current crop year as the state “seeks to protect local producers.”
“Post sees no raw sugar importation as the Philippines government seeks to protect local producers but forecasts refined sugar imports of 240,00 MT [257,000 MT raw equivalent] to stabilize consumer prices and provide two months of buffer stocks,” the USDA-FAS Manila said in its latest Global Agricultural Information Network (Gain) report published recently.
“This includes the 150,000 MT refined imports approved by President Marcos as stated in SO7,” it added.
The USDA-FAS Manila projected the country’s raw sugar imports to remain flat at 1.8 million MT in the crop year 2023-2024.
The international agency’s projection is 50,000 MT lower than the 1.85 MMT forecast of the Sugar Regulatory Administration (SRA).
The USDA-FAS Manila explained that the “prevailing” high sugar prices would drive planters to expand their production, especially those in Mindanao, which would offset the anticipated supply loss in Batangas caused by the shutdown of the Central Azucarera Don Pedro (CADP) mill.
“Post estimates MY 2024 sugarcane area at 385,000 hectares [ha], slightly below the USDA Official estimate of 390,000 due to loss of area in Batangas supplying CADP,” it said.
“Despite the loss of area in Luzon, expansion in sugarcane areas in Mindanao will partly compensate for the sugarcane farms covered by CADP, about 10,500 hectares,” it added.
However, the USDA-FAS Manila pointed out that refined sugar prices at the wholesale and retail levels remained elevated due to anemic domestic sugar output despite the influx of imported stocks.
Citing its computations, USDA-FAS Manila said imported refined sugar from Asean can be sold between P60 per kilogram to P65 per kilogram.
“Consumers wait to see prices decline, but prices continue to be more than P100/kg [$1.76/kg] since January 2023 despite high inventory. Prices had been stable since January but have not gone down to previous levels, not even closer to 2021 prices,” it said.
“Wholesale and retail prices of refined sugar remain elevated despite the country having ample refined sugar stocks. To date, the SO6 and SO7 have failed to address the high retail prices affecting consumers and food manufacturers,” it added.
The Gain report indicated the refined sugar prices in Metro Manila remained above the P100 per kilogram level in August for the tenth consecutive month.
“Consumers continue to wait for lower prices, which have doubled from just over a year ago. Importation brought buffer stocks to a comfortable level until the end of MY 2023 but failed to affect the high retail prices of refined sugar,” it said.