'Too much': Ex-SRA chief says Marcos suggested importing 600k metric tons of sugar
MANILA, Philippines — Not only did President Ferdinand “Bongbong” Marcos Jr. have no objections to importing sugar, he also initially intended to import double the amount that sugar officials suggested, a former sugar administrator claimed.
The controversy stems from Sugar Order No. 4 or SO4, which would have granted the importation of 300,000 metric tons of sugar into the country to bridge what sugar authorities say is a deficit driving up domestic sugar prices.
At the third hearing of the Senate Blue Ribbon Committee on Tuesday, former Sugar Regulatory Administrator Hermenegildo Serafica disclosed in a supplemental affidavit he submitted that he had an August 4 meeting with Marcos Jr.
At that meeting, Serafica said Marcos Jr. instructed the formulation of an import plan, which the former SRA chief took to mean the drafting of a new sugar order. This was corroborated by SRA board member Aurelio Valderrama, who was also at the Senate hearing.
READ: Sugar administrator resigns following import mess
"The instruction was to submit an import plan, and in the language of the SRA, an import plan is an import program in the form of a Sugar Order," Serafica said.
Serafica said that Marcos Jr. initially suggested the amount of 600,000 metric tons, which he felt was too much. Serafica then proposed the 300,000 metric tons being recommended by industry groups, which he said there were no objections to.
Government data released Tuesday showed inflation for sugar confectionery and dessert was up 26% year-on-year in August, as cane and beet sugar inflation hit 54.7%.
Although the sweetener only accounted for 1% in the basket of goods and services used to compute inflation, Nicholas Mapa, senior economist at ING Bank in Manila, said in a Viber message that higher prices for sugar "can spill to other items such as soft drinks, where inflation jumped to 4.1% (in August) from 2.7% (in July)."
Palace says Marcos never suggested importing
Sen. Francis Tolentino, who chairs the Blue Ribbon Committee, held issue with the fact that Serafica did not mention his meeting with the president during the first two Senate panel hearings despite him being present. But Sen. Risa Hontiveros pointed out that Executive Secretary Vic Rodriguez also failed to disclose that meeting in the initial stages of the Senate probe.
Rodriguez — who arrived at the Senate only after it was reported that the Senate committee voted to subpoena him — categorically denied Serafica’s claim, saying the president made no such suggestion.
"There is no truth that the 600,000 MT figure emanated from the President. He was not even convinced with the 300,000 MT importation. Why would he say that 600,000 MT needed to be imported?" he said in Filipino.
READ: ES Rodriguez arrives at Senate after Blue Ribbon panel issues subpoena
Though Rodriguez confirmed having that meeting, senators spent over half an hour quibbling over whether or not the meeting was held in person or over Zoom. Tolentino went as far as threatening to cite Serafica — who attended the hearing virtually after testing positive for COVID-19 — in contempt for "lying."
Rodriguez earlier admitted to receiving a draft of the controversial sugar order, but ignored the notification despite follow-ups from former Agriculture Undersecretary Leo Sebastian because Marcos had not yet come up with a decision at the time.
Manuel Lamata, president of the United Sugar Producers Federation of the Philippines, also called into question the SRA's consultation with stakeholders, as he accused Serafica of committing perjury. "I'm very sure he's lying...I never heard of that meeting or the 600,000 (MT)," he said.
According to Lamata, when the group was consulted, the overwhelming sentiment on both sides was to import only refined sugar to help carry the industry through the lean months at the start of the next crop year.
He said he was blindsided when the final sugar order imported 150,000 metric tons of raw sugar and another 150,000 for refined. "I never signed on for that. We said all refined, so why is there raw sugar?" Lamata said.
At the previous hearing, Ruben See, president of the Philippine Food Processors and Exporters Organization Inc., also claimed his group was left out of the consultations.
"We were not consulted...The only problem in our industry is the high cost of sugar. Usually, we exporters need a low price of sugar. Because if the cost of sugar is high, the exporter isn't competitive. Based on what we saw, it seems that there is no shortage. But based on what Usec Sebastian said, because of the usage, there seems to be a shortage,” he said.
Groups: Looming shortage not artificial
But other industry groups have since pointed out that the sugar crunch has begun affecting operations.
"I do not believe that it is artificial...When it was being proposed at that meeting I attended in Malacanang, what was being pushed was 150, and I said anything is better than nothing," Paolo Lobregat of the Philippine Sugar Millers Association said at the previous hearing.
"We will be running out of sugar around October, the first week of October, maybe a little more. Depends if you want to stretch it out, but that will be a whole month before we start milling again. And that is the best case scenario," he also said in an interview aired over One News.
The PSMA was among the stakeholders that recommended importing 300,000 metric tons in its written communication to the SRA.
"Since the beginning of 2022, we began to observe a scarcity of bottler’s grade premium refined sugar as well as a dramatic surge in prices of what available stocks we could source. In other words, we're having trouble manufacturing in the customary manner," lawyer Juan Lorenzo Tanada, spokesperson for Coca-Cola Beverages Philippines, said in the second hearing. — with a report from Ramon Royandoyan
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