MANILA, Philippines - The Philippines will reduce sugar exports to the United States for the current crop year which ends in September because of oversupply, officials of the Sugar Regulatory Administration (SRA) said yesterday.
In a phone interview, SRA Board member Cocoy Barrera said there is oversupply in the US because of abundant raw sugar supply from Mexico which enjoys zero- tariff and zero- quota on its sugar exports to the US.
Philippine raw sugar to the United States, therefore, fetches lower millsite prices of P 643 per 50-kilo bag compared to “D” or world market sugar which is P 715 per 50-kilo bag, while “B” or domestic sugar is P 1,435 per 50-kilo bag. Composite price of Philippine sugar is placed at P1,298 per 50-kilogram bag.
“Philippine sugar is not as attractive as Mexico sugar so we will reduce our export volume to the US this crop year,” said Barrera. “But we will be keeping our regular US sugar quota.”
The Philippines has a regular US sugar quota of 138,827 metric tons (MT) this year.
“We have already sought advice from the US government and they have agreed that this will not be taken against us,” said Barrera.
So far, the country has shipped out 27,160 MT of sugar to the US. Another shipload of 23,600 metric tons is set to leave for the US by the end of June.
Barrera said a final shipment volume of a still undetermined volume is still being worked out by exporters.
“We are still verifying the amount that could be exported,” he said.
SRA administrator Ma. Regina Martin said the SRA is considering to conduct an advance shipment of sugar to the US in the next crop year. The allocation for “A” sugar will then be reduced while allocation for “D” sugar will be increased.
The “D” sugar allocation may be swapped for ethanol production.
On the other hand, the target export volume of 180,000 MT to the world market would be attained this year with 141,000 MT already set out for shipment as of June.
As of June 2, sugar domestic production reached 2.448 million MT, 0.6 percent higher than SRA’s second production estimate of 2.434 million MT for crop year 2012-2013.
In a text message, Rosemarie Gumera, Manager of the policy and planning department of the SRA, said sugar production is still seen to increase because the milling season has not yet come to a close and several small mills are still operating.