THE Sugar Regulatory Administration (SRA) said it will undertake a limited voluntary purchasing program for raw sugar to prop up soft millgate prices.
“The target for this voluntary limited-volume purchase of domestically produced raw sugar is to ensure a stable and reasonable farmgate price while maintaining the prevailing level of retail price,” the regulator said in a draft sugar order (SO).
The SRA has reported that millgate price for raw sugar had declined to as little as P2,400 per 50-kilogram bag.
The regulator said the purchasing program will acquire a maximum of 300,000 metric tons (MT).
Raw sugar purchased through the program will be reclassified as “C” or reserve sugar, to be kept from market circulation.
Participants deemed eligible for the purchasing program are farmers, farmer’s groups, farmer’s cooperatives, farmer’s associations, sugar millers/refiners, manufacturers, and beverage makers.
Participants in the SRA’s voluntary purchase program will be eligible to take part in a future round of imports.
SRA Administrator Pablo Luis S. Azcona said it hopes the draft sugar order can be signed within the month, with the maximum volume subject to change.
During the 2023-2024 crop year, the SRA had implemented a voluntarily purchase program to stabilize farmgate and retail prices. Participants were also eligible for allocations of imported sugar.
Under Sugar Order No. 2, the SRA allowed qualified participants to purchase 300,000 MT of raw sugar to stabilize prices.
Last year, the SRA had approved the import of 200,000 MT of refined sugar to stabilize retail prices.
Separately, the Sugar Council said that the proposed SO will protect farms from price fluctuations during the peak of the harvest.
It added in a statement that Mr. Azcona has reiterated that “there will be no imports until May or June when the harvest is finished.”
The Department of Agriculture (DA) has said that it will postpone any sugar import plans until the middle of the year, as domestic supply is expected to be sufficient.
The SRA projects a 7.2% drop in sugar production from the 1.92 MMT reported during the previous crop year, citing damage sustained during the dry conditions brought about by El Niño.
It added that the move should reduce the volume of available sugar in the domestic market during the harvest months “thus helping stabilize millgate sugar prices.” — Adrian H. Halili