Creation of Phil Sugar Act proposed

Sugar producers are proposing the creation of a Philippine Sugar Act (PSA) that will, among others, govern the importation of sugar.

The proposal was raised during a recent sugar summit attended by various industry representatives, including the Department of Agriculture (DA) and the Sugar Regulatory Administration (SRA).

The sugar producers said the industry is in a better position than the National Food Authority (NFA) to handle sugar importation, specifically those brought in under the minimum access volume (MAV).

Under the scheme, sugar imported through the MAV can be allowed entry into the country at a low tariff of 50 percent while sugar outside of the allocated MAV, is levied a tariff of 65 percent. The MAV, which varies per product, is the least volume of imports the government allows for sensitive agricultural commodities.

NFA is authorized by Congress to import sugar under the MAV since this helps the former to offset its losses from buying domestic sugar at a support price and selling this to consumers at low prices.

Congress last year directed the NFA to import 51,000 MT of sugar under the MAV to stave off a shortage and prevent domestic prices of sugar from skyrocketing.

In the proposed PSA which needs to be legislated, industry leaders said the importation of sugar will be handled by a sugar producers’ cooperative. The proposed cooperative will have equal representation among the different sugar planters and millers associations.

Sugar industry leaders complained that the NFA has mismanaged the importation of sugar by importing more than what is actually needed and these are eventually dumped in the local market.

As a result, producers said the prices of locally-produced sugar were depressed.

The sugar summit was held upon the prodding of sugar producers and millers led by the National Federation of Sugarcane Planters Inc. (NFSP) who were worried about the skidding prices of sugar, especially in Negros Occidental which accounts for about 50 percent of the country’s total production.

The strong lobbying has forced the NFA to suspend the auctioning of sugar to traders and industrial users for the rest of the year.

The NFA also committed to release a maximum of 120,000 bags of refined sugar a month through the Erap stores after sugar producers complained NFA’s previous flooding of cheap sugar into the market, caused a huge drop in prices.