The Philippines will not export sugar this crop year amid expected lower output, according to the Sugar Regulatory Administration (SRA).
On August 31, SRA already formally issued Sugar Order (SO) 1, which contains the agency’s production estimate for the current crop year as well as its market allocation. SO 1 was signed two days after Business Bulletin obtained its draft and reported its contents.
As reported, SRA's pre-milling estimate for raw sugar production in calendar year 2021 to 2022 is 2.09 million metric tons (MT), which is lower than the estimate of 2.10 million MT the Philippines was hoping to produce in the previous crop year.
Citing Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA), SRA fears that the reemergence of La Niña phenomenon, which will bring above normal rainfall in the country, will result in low sugar recovery.
PAGASA forecasts that the Philippines will start to experience La Niña in either late October or November, and will last until the first quarter of 2022.
The rains, according to SRA, will encompass almost all sugar producing provinces at their start and peak milling for crop year 2021 to 2022.
As a result, and after consultation with sugar producers, SRA heeded to the recommendation that all the country's sugar output will go to the 'B' sugar allocation, which is meant for domestic market, and that zero will be allotted to 'A' sugar, which is meant for sugar exports to the US.
The country’s sugar crop year starts in September and ends in August.
In the middle of the last crop year, SRA issued SO 1-A scrapping the allocation for ‘A’ sugar amid lower output. However, some producers were still able to export prior to the issuance of the order.
This made the issuance of SO 3 or the “’A’ Sugar Export Replenishment Program” possible, allowing those who exported sugar to the United States to import the corresponding volume of sugar that they exported.