Sugar prices on the rise

Sugar prices have greatly improved following the shipment of Philipine sugar to the world market.

Millgate prices have increased from around P680 to P700 per bag in November when the D sugar was still in the country to P760 to P780 per bag this week. Industry officials expect prices to improve further in the next few weeks. About 100,000 bags of sugar have been shipped to the world market while another 120,000 bags or more are expected to be exported soon.

"Were it not for the early shipment of sugar to the world market and its successful implementation, sugar prices would have been worse even at this time. Definitely, we are now feeling the effects of the D export program and we see the trend of rising sugar prices to continue," Reynaldo Bantug, national president of the Confederation of Sugar Producers Associations (Confed), said.

The Sugar Regulatory Administration (SRA) earlier classified 10 percent of the estimated 2.28-million metric ton production for crop year 2004-2005 which started last Sept. 1 as "D" sugar for shipment to the world market. Exports of Philippine sugar to the world market are on top of shipments to the United States which are classified as "A" sugar. Domestic sugar is classified as "B" sugar.

About 35 percent of the "D" sugar that had been committed to be shipped out came from sugar producers affiliated with Confed, the country’s largest organization of sugar farmers. "Because of the D program, we are now experiencing better prices of B sugar especially in Negros," Bantug said.

He acknowledged the sacrifice made by sugar farmers who had to bite the buttlet and sell their produce to the world market where prices are lower compared to the US and Philippine markets.

The Philippines has become a net exporter of sugar due to the successful efforts of both government and the private sector to improve domestic production. From 1.805 milion metric tons in crop year 2000-2001, domestic sugar output has increased to 1.898 million MT in 2001-2002 and 2.1 million MT in 2002-2003. Last year, production stood at 2.338 milliion MT.

The country sold about 160,000 tons of excess sugar in Asia last year. This was in addition to its annual export quota of about 137,000 tons to the US.