SRA offers raw sugar exports to US

MANILA, Philippines — The Sugar Regulatory Administration (SRA) has offered to export raw sugar to the United States, which will partly fulfill the country’s trade allocation to the western country.

SRA administrator Pablo Luis Azcona said that six to eight producers, millers and traders have volunteered to deliver 30,000 to 60,000 metric tons (MT) of raw sugar to the US market.

“We have traders and producers and millers who have volunteered to serve part, or if not whole, of the US market. So this is voluntary. They were the ones who approached us,” he said.

Annually, the US establishes a minimum in-quota allocation as part of its commitment to the World Trade Organization.

The US set the Philippines’ sugar allocation at 145,235 metric tons raw value (MTRV) for this crop year, from Oct. 1, 2023, to Sept. 30, 2024 – the same volume allocated as last year.

However, the country has not used its allocation in the past three years because raw sugar production has not been sufficient to meet local requirements.

For the crop year 2023-2024, the SRA allotted the entire sugar output for domestic use (‘B’ allocation) amid a projected 10 to 15 percent decline in production due to the El Niño phenomenon.

Given the circumstances, the SRA wrote to the US Department of Agriculture (USDA) at the beginning of the milling season in September, requesting a moratorium on the country’s in-quota allocation to maintain the US as an export market for raw sugar.

But with volunteers ready to serve the US market, Azcona said the SRA wrote to the USDA again, seeking clearance for the group of traders, millers and producers to partially fulfill the allocation with raw sugar bought directly from local farmers.”

“I wrote the USDA again that there are people who are volunteering (to export raw sugar) and, hopefully, they will grant our quota. That’s what we are waiting for. Once the US gives us a signal to export, then the exporters will do it right away,” he said.

However, exporting sugar to the US market will also require the approval of the SRA board to convert “B” sugar to “A” sugar, or for export to the US.

“For the US quota, since we will be converting domestic sugar for the US market, a sugar order should be issued. Right now, we’re in the planning stage. We’re discussing the mechanics and everything. We will bring this up to the SRA board and then we will decide and then issue the appropriate sugar order,” Azcona said.

The SRA chief said this matter was brought up before the SRA board.

“In the last SRA board meeting, there have already been initial discussions. So, I am not privy if the Secretary (of Agriculture) already informed President Marcos…But as the board already discussed it, so far what was ensured was it should not have an effect on farmers and millers,” he said.

The Philippines last shipped raw sugar to the US market during crop year 2020-2021, involving 112,008 metric tons of commercial weight (MTCW) of raw sugar.

The US sets tariff rate quotas (TRQ), which allows certain countries including the Philippines to deliver specified quantities of a product to America at a relatively low tariff, but subject all imports of the product above a predetermined threshold to a higher tariff.