Sugar millers, refiners back import clearance fee on alternative sugars

MANILA, Philippines — The country’s biggest groups of sugar millers and refiners have thrown their support behind the imposition of a clearance fee on imported sugar alternatives, claiming that the measure is not meant to impede importation of the commodities.

In a joint statement, the Philippine Sugar Millers’ Association Inc. (PSMA) and Philippine Association of Sugar Refineries Inc. (PASRI) dismissed concerns of certain industry players that the implementation of Sugar Order (SO) 6 would lead to a price hike on various products such as candies and beverages.

SO 6 imposes an import clearance fee on sugar alternatives prior to their release to the market as the Sugar Regulatory Administration (SRA) seeks to capture the volume of sugar alternatives that enter the country.

The SO covers sugar alternatives and sugar-based items under tariff headings 1701, 1702 and 1704.

Commodities under 1701 include sucrose, specialty sugar and flavored syrup while those under 1702 include so-called “other sugars” like lactose, glucose, maltose, maple syrup, honey and caramel.

Goods under tariff heading 1704 are sugar confectionery items such as chewing gum and white chocolate not containing cocoa.

“Except for fructose, the fee is only P60 per metric ton, equivalent to P0.06 centavos per kilo. This should not have a significant effect on consumer prices,” PSMA and PASRI said.

PSMA president Terence Uygongco said SO 6 serves as a “crucial” tool for the government to accurately assess the supply and demand for sugar in the country amid concerns on the continuous drop in demand for the sweetener in recent months.

“Sugar producers are puzzled by the weakening demand for sugar. Given the country’s growing population and a strengthening economy, we should expect an increase in sugar consumption,” Uygongco said.

“However, demand has declined – remarkably, it is even lower now than during the COVID-19 lockdowns. The SRA has pointed out that SO6 was  issued to monitor the entry of alternative sweeteners and sweetened products, which impact the sugar market that in turn affects our local farmers,” he added.

PASRI president Renato Cabati emphasized that SO 6 is not meant to restrict the importation of the alternative sweeteners, arguing that the SRA clearance for release is not the same as an import permit.

“Anyone can still import sweeteners, provided they comply with the clearance process. The fees and requirements outlined in the order are standard procedures for sugar importation,” Cabati said.

“SRA may simply be seeking to establish uniform regulations for both sugar and other sweeteners,” he added.

The two groups also noted that it is within the purview of the SRA to collect its own data on imported alternative sweeteners as it is mandated to oversee the country’s sugar industry.

“As a regulatory agency, SRA must have its own accurate figures on all factors affecting the sugar market,” the groups said.

“It cannot solely rely on external sources, such as the Bureau of Customs, to determine sugar and sweetener demand,” they added.

Uygongco and Cabati said that SO 6 underwent thorough legal and regulatory review before its issuance.

“There should be no doubt that SRA acted within its mandate,” they said.

SRA administrator and CEO Pablo Luis Azcona earlier disclosed that the implementation of SO 6 has been deferred following complaints from certain quarters of the industry such as candy makers and beverage manufacturers.

Azcona said some of the concerns that were raised to the SRA by industry stakeholders were the possibility of delays in processing of the import clearance fees and the costs stipulated under SO 6, which was supposed to take effect on Feb. 1. — Bella Cariaso