SRA: Sugar situation normalizing soon

The Sugar Regulatory Administration is expecting the sugar situation to normalize in the coming months once refinery operations resume in full swing starting next month, which is seen to offset the tight supply and high prices of the sweetener.

"We expect supply from the mills to flow into the market as refineries are expected to be in full operation by next month. Some sugar mills have already started milling and we will soon see a steady supply of sugar," SRA acting administrator David John Thaddeus P. Alba said on Wednesday.

"The projected production will be lower than the current demand. As such, to also address the tightness of our sugar supply, the Sugar Board passed an importation program to serve both the industrial users and consumers. Nevertheless, SRA is regularly monitoring the supply and demand situation so we can act accordingly," he added.

The SRA, through its Sugar Order 2 series of 2022 to 2023, has allowed the importation of 150,000 metric tons of sugar as a "stop-gap measure" to ensure the stability of supply in the market.

The order, which was signed by President Ferdinand R. Marcos Jr., allocated 75,000 MT for industrial users and another 75,000 MT for consumers.

The order mandates that sugar traders participating in the import program need to ensure that their respective allocated volumes arrive in the Philippines before 15 November.

On Tuesday, the SRA also issued the Sugar Order 1 series of 2022 to 2023, which strictly allocates all sugar produced during the crop year 2022 to 2023 for domestic consumption to avoid the country's import dependence.

The SRA said that 100 percent of raw sugar production for the current crop year should be classified as "B" or the domestic sugar market.

A crop year starts in September and ends in August of the following year, however, the sugar mills and refineries generally stop operations around May to June. The mills start operations for the next season around September to October while the refineries start around two weeks after the mills.

Based on the latest projection of the SRA, the total raw sugar production for the crop year 2022 to 2023 is estimated to reach 1.87 million metric tons, while the total domestic raw sugar withdrawal during the year is pegged at 2.03 million MT.

Historically, the country must have carryover stocks of 250,000 MT of raw sugar and around 200,000 MT to 250,000 MT of refined sugar at the end of any crop year.