Sugar price hike due to world market

Officials of the Bogo-Medellin Sugarcane Planters Association clarified yesterday that the decrease in the incidence of sugar smuggling into the country and the hike in prices of sugar in the world market has caused the increase in the prices of sugar here.

Jose Mari Miranda, president of BMSPA, also said that hoarding is not their practice because sugar is only produced in five to six months while demand for sugar goes on the whole year through.

He explained that the hurricanes that hit two states of the United States and the disaster that hit Thailand recently are among the causes in the hike in prices of sugar in the world market. Miranda added that the increase in prices of fuel, labor, fertilizer and all the inputs in the sugar cane plantation have also gone up.

"Our consumption has also gone up. The prices of labor, fuel and fertilizers have gone up. We are even surprised why the price (of sugar) before is low when in fact, all inputs have already gone up long time before," he stressed.

According to him, prices of sugar here has gone up to almost 80 percent from the previous P750 last year to P1,300 per bag this year. Cebu's sugar production accounts for only more than one percent of the total production of the country of six million tons.

He said that the government has taken initiatives to solve the smuggling of imported sugar into the country, one of the reasons which also contributed to the increase in prices of sugar here, because smuggled sugar costs lower than our local product.

However, due to good production of sugar here and high demand in the world market, Miranda said that there is tendency that smuggling of sugar out of the country will become rampant because some might be enticed to take advantage of the high prices abroad.

Earlier, the Sugar Regulatory Authority said the raw sugar production this year is 4.25 percent less compared to last year because of the relatively wet weather, which slowed down harvest and brought down the sugar content of the canes.

But SRA assured that the country still has enough supply because it is producing raw sugar at more than twice the rate of consumption in the country. It said that there is no sugar shortage until about June, while the production peaks in March or April where another 600,000 metric tons is expected. It projected 2 million metric tons production this year and expects 95 percent increase in demand. It also accounted a slight rise in the international demand for sugar, which was another cause of speculations for importing even without duty. -Wenna A. Berondo