Amid the shortfall in the country's sugar production, the Philippine government has allowed the importation of the sweetener until October of this year, with Sugar Regulatory Administration (SRA) expecting the entry of nearly 86,000 metric tons (MT) of additional imported sugar.
As this happened, the Bureau of Customs (BOC) recently released the list of registered international sugar traders and importers. It also acknowledged SRA’s request for assistance for an uninterrupted sugar importation.
In Sugar Order (SO) 3, which was signed in the latter part of May but was only recently made publicly available, SRA ordered the so-called “’A’ Sugar Export Replenishment Program”, allowing those who exported sugar to the United States (US) during the current crop year to import the corresponding volume of sugar that they exported. ‘A’ sugar refers to sugar exports allotted to the US.
This, since the final crop estimate for the current crop year, which started in September last year and will end this month, is estimated to be 2.10 million metric tons (MT), lower than the initial pre-milling crop estimate of 2.19 MT.
Another estimate, which came from a group of refiners, also showed that total refined sugar production for the year will also drop by 14.31 percent.
SRA said it is necessary to issue the ‘A’ export replenishment program in order to address inflation brought about by rising prices of domestic sugar.
“The ‘A’ export replenishment program is proven to be a successful and effective mechanism to augment domestic sugar supply last crop year wherein those that exported or shipped out the ‘A’ sugar produced in crop year 2019-20 to the United States in Quota Year 2019-20 were issued SRA clearances for the sugar they imported as replenishment for the volume of ‘A’ sugar exported,” SO 3 reads.
“The ‘A’ export replenishment program also benefits sugar producers, particularly the small sugar farmers and agrarian reform beneficiaries (ARBS), that have sold their ‘A’ sugar prior to this program/order,” it added.
The replenishment must arrive no sooner than July 1, 2021, and no later than October 31, 2021, based on SO 3.
SRA officials were asked what volume of sugar is allowed to enter the country based on SO3, especially since SRA also issued SO 1-A, which amended SO 1 in March and suspended the exportation of sugar during the current crop year.
To recall, SO 1 allotted 7 percent of the country’s forecasted sugar production for the year to ‘A’ sugar. But with SO 1-A, the government is no longer requiring sugar producers to fulfill the Philippines' commitment to the US amid the lack of supply, which means 100 percent of the country's sugar output should stay here.
It was also through SO 1-A when SRA formally brought down its target local sugar production for the current crop year to 2.10 MT from 2.19 million MT.
But apparently, despite SO 1-A, some sugar producers were still able to export sugar to the US during the crop year, an industry source said.
This was later on confirmed by SRA Administrator Hermenegildo Serafica, who said that as of August 18, the total allocation volume for importation under SO 3 is 85,547.858 MT of refined sugar, which means that some producers were able to export that same amount of sugar to the US despite SO 1-A.
Of this volume, Serafica said 43,025 MT of refined sugar have already been issued clearances for importation. Out of the volume issued clearances, 30,975 MT refined sugar has already arrived and cleared from customs.
It is not yet clear if such sugar exportation to the US took place before or after the issuance of SO 1-A.
Meanwhile, BOC also recently issued the memorandum circular (MC) 167-2021, acknowledging the list of registered international sugar traders and importers participating in the importation under SO3.
These traders and importers are Alderberg Industrial Corporation, All Asian Countertrade Inc., Commtrades Group (CTG) Inc., Crystal Sugar Company, Inc., Delmax Corporation, La Perla Sugar Export Corp., Oro-Agritrade, Inc., Oro Allado Commodities, Inc., and Sucden Philippines, Inc.
In the said MC, BOC also recognized the request of SRA for assistance to facilitate the release of imported sugar to these importers.