Government to siphon off 300,000 MT of raw sugar from local market

MANILA, Philippines — The government is planning to siphon off about 300,000 metric tons (MT) of raw sugar from domestic market circulation for as long as three months to lift the farmgate prices of the commodity.

The Sugar Regulatory Administration (SRA) board has started its deliberations and industry consultations regarding the implementation of a voluntary purchase program for the current crop year 2024-2025.

Under a draft sugar order, the program would involve the purchase of 300,000 MT of raw sugar at a premium on a first come, first served basis.

The sugar bought under the program would be held off from domestic market sale for a period of not more than 90 days, effectively reducing the available supply with the hopes of increasing farmgate prices of the sweetener.

The draft sugar order noted that the aim of the program is to “ensure stable and reasonable farmgate prices of locally produced sugar while maintaining the prevailing level of retail prices.”

The SRA deemed it necessary to implement a second round of the voluntary purchase program after taking into consideration the prevailing sugar industry data and in anticipation of peak production in the next three months.

The program was first done last year and was deemed successful by both the government and the industry stakeholders.

Like last year, the voluntary purchase program would incentivize eligible participants by providing them priority in future sugar import programs of the government.

Under the draft sugar order, eligible participants would be able to import one kilo of raw sugar for every two kilos they bought under the voluntary purchase program.

SRA administrator and CEO Pablo Luis Azcona said the volume stipulated under the draft sugar order is not yet final.

Azcona added that the draft sugar order would be signed by the SRA board, chaired by Agriculture Secretary Francisco Tiu Laurel Jr., within the month.

Industry group Sugar Council lauded the proposed voluntary purchase program of the government, which it claimed would shield sugarcane planters from price fluctuations during the peak of the harvest and milling season.

Farmgate price of raw sugar as of Jan. 5 stood at P2,600 per 50-kilo bag, about P200 higher than the P2,406 recorded price in its preceding week, based on SRA data.

Meanwhile, the prevailing raw sugar prices in Metro Manila markets have remained relatively stable between P73 and P80 per kilo despite fluctuations in the farmgate price of the commodity since September, SRA data showed.