Sugar production seen to hit 10-yr high

The country’s sugar production for cropyear (CY) 2002-2003 ending this August is expected to hit a 10-year production high of 2.13 million metric tons (MT), making the Philippines self-sufficient for the first time in more than a decade.

This CY’s sugar output is 12.7 percent higher than CY 2001-2002’s 1.89 million MT – more than enough to meet domestic requirements and its export commitments under the US sugar program.

Sugar industry leaders noted this is the first time in more than 10 years that the Philippines has surpassed the two million MT sugar production mark.

They attributed the improvement to increased used of high-yielding sugar varieties, good climate, and better farm practices.

If the trend continues, Sugar Regulatory Administration (SRA) chief James Ledesma said the country will regain its status as a net sugar exporter, and it should start scouting for other export markets aside from the US.

The Philippines has been exporting sugar to the US for many years under a tariff rate quota system and has been receiving a premium price for its produce compared to the world market price.

However, while it has been shipping to the US, it has also been importing sugar to meet domestic requirements.

"With domestic sugar consumption at two million metric tons and the US sugar export quota at around 130,000 metric tons, the Philippines has already achieved its goal of self-sufficiency in its sugar requirements," said Ledesma at the International Sugar Organization’s (ISO) meeting yesterday in Cebu.

With this development, industry leaders said it’s no longer necessary to bring in the minimum access import volume (MAV) this year of around 59,790 metric tons.

This could prompt the Department of Agriculture to shelve importation of sugar under the MAV.

Under the GATT Uruguay Round agreement, governments committed certain volumes of agricultural imports which will be brought in at preferential tariffs. However, DA officials said the importation of MAV can be waived if it will result in a glut in local supply, to the detriment of domestic farmers.

For his part, ISO executive director Dr. Peter Baron noted that the Philippine economy last year has definitely exceeded expectations.

"In 1996, the Philippines was importing as much as 670,000 metric tons of sugar. Now, it has achieved self-sufficiency," he said.

Baron added that with production exceeding consumption for the first time since 1994, "I won’t be surprised to see the Philippines back in the league of exporters."

The ISO has 63 member-countries, including the Philippines, which account for 81 percent of world sugar production and 63 percent of consumption. Just last January, it included as its newest member the Russian Federation, considered the single largest importer of sugar.