SRA allows US sugar exports

MANILA, Philippines - The Sugar Regulatory Administration (SRA) is allowing the reallocation of sugar meant for the domestic market for shipment to the United States to fulfill its export quota.

SRA administrator Ma. Regina Martin said yesterday a sugar order would be issued to fill up the US sugar quota (represented by A sugar quedans) and a corresponding importation replacement program for domestic market sugar (represented by B sugar quedans).

To enable the industry to export to the US, Martin said the SRA would allow the export of B sugar to the US up to a volume of 142,000 MT.

The resulting deficiency in domestic supply may be replaced by sugar imported from the world market amounting to the same volume of 142,000 MT.

 Martin said the order could be finalized and signed today (Dec. 4).

“It is to the national interest that the Philippines exports to the US under its sugar quota allocation while ensuring sufficient supply of sugar for the domestic market,” she said.

For the current crop year, the Philippines was granted a US sugar quota allocation of 142,000 metric tons raw value (MTVR) under the tariff-rate quota (TRQ) that allows select countries to export to the US at low tariff.

Fearing the brunt of the dry spell, the SRA allocated all sugar production for the current crop year—which started in September and ends in August 2016—for the domestic market to protect local supply and prevent price spikes.

The SRA, however, remained open to fulfill the US export quota as it is a major export market for the Philippines and offers the best price for Philippine sugar.

Compared to prevailing world market prices of $0.10 to $0.12 per pound, the US buys sugar at around $0.20 per pound to $0.22 per pound.

Under the TRQ system, the US only allows the exportation of sugar from countries granted quotas.

Martin earlier said not all countries capable of exporting sugar could ship to America as it is also a political decision for the US on what countries it grants an export quota to.

Based on a crop estimate conducted as of October, the SRA expects raw sugar production to be lower than 2.27 million metric tons.

The SRA would issue a clearance for the release of the replacement sugar which may be classified as either B or C (reserve sugar).

Martin said the export to the US using B sugar would be on a voluntary basis although it would be restricted to sugar exporters who are registered with the SRA as an international trader for the current crop year.