No early sugar exports to US – SRA

MANILA, Philippines - The Philippines will not export sugar to the United States ahead of schedule because of weak prices of the sweetener in the US, according to the Sugar Regulatory Administration (SRA).

SRA administrator Ma. Regina Martin explained that the weakening of prices in the US is caused by abudant sugar production in the US as well as in Mexico which has unrestricted access to the US market.

 “The demand in the US is not that high because they had a good harvest, so traders were not able to close agreements (for early export to the US). But we will definitely fulfill our US quota,” said Martin.

The Philippines has a regular US quota of 138,827 MT. The regular shipment to the US will commence in in January with a shipment volume of 25,000 MT.

Next month, however, 9, 140 MT of raw sugar has been cleared for shipment to the world market which is expected to help alleviate the domestic glut.

For now,  domestic supply is still abundant so prices are expected to remain stable this holiday season at an average of P45 per kilo for brown sugar and P50 per kilo for white sugar.

The SRA wants to relieve pressure in the domestic market caused by growing volume and weak demand.

The country currently has 40,952.80 metric tons of “A” or US quota sugar and 55,853.24 metric tons (MT) of “D” or world market sugar on stock and ready for export.

Sugar milling for crop year 2012-2013 started last September 1.

Last sugar crop year, the Philippines exported more than 200,000 MT to the United States and about 326,000 MT to the world market.

For the previous crop year, the US granted an additional quota of 72,374 MT. For the current crop year, the US Department of Agriculture is yet to announce the additional quota.

The SRA has set a sugar production target of  2.356 million metric tons (MT) for crop year 2012 -2013, up by five percent from the total raw sugar production volume of 2.243 million MT for crop year 2011-2012.

The SRA is also lowering the export allocation of “D” sugar or world marker sugar to eight percent of the total production from the previous 20 percent as domestic prices remain competitive to other markets.