The Philippine sugar industry is integral to the country’s economy as it confines domestic consumption and global trade. However, the trends from when sugar first entered the market to where it is now have changed due to production, government policies, market trends and local demand.
Subsequently, these suggest that the movements in importing and exporting have also changed. This article will discuss the various economic activities that affect the movement of sugar then and now.
Import Trends
Conceptually, importation happens where there is low domestic production. The government relies on this strategy to stabilize supply and ensure sufficiency at the height of demand.
Although not entirely, this move also helps keep sugar from price hikes, while shortages in sugar supply are often connected to natural calamities or climate-induced restraints.
Sugar regulating bodies like the Sugar Regulatory Administration (SRA) in the Philippines ensure a balance between production and importation. But despite their mandate, these importation initiatives have been contentious, especially for local farmers.
This sector clamors about the potential displacement of their livelihood following the country’s intent to import 240,000 metric tons of sugar come September 2024. This notion comes from the idea that imported sugar might cost less than local produce because of cheaper tariffs or smuggling.
On the other hand, food and beverage manufacturers find this move favorable as liberation from importation can lower their manufacturing costs and stabilize sugar supplies.
Authorities also believe that importing sugar will help dampen the effects of climate and environmental challenges.
Export Dynamics
Export activities in the Philippine sugar industry depict the exact opposite of importing. At least every professional in the field recognizes how the country was once a sugar powerhouse, exporting to neighboring Asian countries and the United States.
But what happened now? The Philippines began experiencing diversification of its export markets following the opening of the U.S. to global trade. The country has also faced fluctuating sugar production levels due to climate change, importation threats, and the need to meet domestic demand.
Although the SRA acknowledges these challenges in the industry, the country remains steadfast in searching for new markets in the Middle East and Asian neighbors to enhance export performance.
The authorities’ target to begin exporting again this year is coupled with these.
Regulatory Measures
The planned sugar import might have posed a significant concern to our local farmers, but these actions do not go uncontrolled.
The recent Sugar Order 5 by Department of Agriculture secretary Francisco Tiu Laurel, Jr. has laid guidelines including, but not limited to, the following:
SRA Bacolod and Quezon will accept import applications within five working days from effectivity;
Import allocations will follow within five working days after applications are due;
Every 50-kilogram bag is subject to a bond worth P250;
The SRA shall label imported refined sugar as “C,” or a classification dedicated to reserve sugar.
With these policies, SRA remains firm that this import direction aims to prepare the country for the adverse effects of El Niño and keep stocks sufficient until the next milling season.
Several internal and external factors influence sugar import and export in the Philippines.
However once the country proved to be an important player in the global sugar market, the Philippine sugar industry can work its way back to its peak.
All the regulatory body needs are immense planning and efficient strategies to adapt to these changing dynamics and balance domestic supply and demand.
