The country’s raw sugar production in the upcoming marketing year (MY) is expected to decline by as much as 200,000 metric tons (MT) due to the looming impact of a prolonged dry spell brought by El Niño in the latter part of the year, according to the United States Department of Agriculture (USDA).

In a report dated April 29, the USDA estimated that local sugar output for MY 2026 to 2027 will reach 1.93 million MT, lower than the current year’s expected production of 1.95 million MT.

The US agency attributed the contraction to the potential impact of El Niño on sugarcane production, which is expected to persist through the end of the year. The incoming MY will begin in October and conclude in September of the following year.

Based on data from the Philippine Atmospheric, Geophysical, and Astronomical Services Administration (PAGASA), El Niño conditions are likely to emerge between June and August, with a 79-percent probability as of April 22.

“Below-normal rainfall and elevated temperatures associated with El Niño conditions typically cause early maturity that results in lower cane volume, reduced sugar content, and potential early mill closures,” the USDA said.

The USDA’s projection is based on what happened during MY 2023 to 2024, when a rain shortage directly contributed to a one-percent decline in sugar production compared to the previous year.

This year, however, could be more extreme amid forecasts of a “super” El Niño, a phenomenon in which temperatures in the Pacific Ocean increase by at least two degrees Celsius above average, potentially straining water resources.

Under a projection of lower output, the USDA said domestic ending stocks may fall by nearly seven percent to 704,000 MT in MY 2026 to 2027 from the current year’s estimate of 753,000 MT.

The USDA said early mitigation measures by the government could help temper the impact of El Niño on sugar production.

Last week, Department of Agriculture (DA) Secretary Francisco Tiu Laurel ordered government units under his watch to prepare for worst-case scenarios involving the dry spell to ensure the country’s food security, especially against the backdrop of an ongoing oil crisis.

According to the DA, the combined impact of El Niño and higher energy costs “could heighten risks to food supply, push up prices, and weigh on overall economic growth.”

The USDA said lower sugar production in the next MY will also be driven by the country’s inability to expand sugarcane planting areas amid land conversion.

The agency expects the total sugarcane area harvested to remain at 400,000 hectares (ha), with output seen dropping to 24.3 million MT from 24.5 million MT.

The country’s sugar consumption in MY 2026 to 2027 is expected to increase to 2.25 million MT from 2.2 million MT in the previous year, as demand for sugar and sugar-containing products grows alongside the country’s expanding population.

Half of the country’s demand is for industrial use, with households accounting for 32 percent and institutional users at 18 percent.

The USDA said the country may import 300,000 MT of refined sugar in the upcoming MY. Meanwhile, it currently does not expect any sugar exports, pending the issuance of export guidelines by the United States (US), the country’s sole export market for raw sugar.