Philippines to stop exports raw sugar to the United States

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The Philippines will not export any raw sugar to the United States in order to satisfy the predicted supply gap, the Department of Agriculture (DA) said on Monday.

“We will no longer allow sugar exportation to the US,” Agriculture Secretary William Dar stated in a virtual briefing, partly in Filipino.

“Local production will be used to make up for the projected supply shortfall in the country,” he told reporters in Filipino.

The United States Department of Agriculture (USDA) already reduced its export forecast for marketing year (MY) 2021/2022 to zero from 140,000 metric tons (MT).

This was based on the Sugar Regulatory Administration’s (SRA) decision to allocate all domestic market sugar classed as “B” sugar for domestic consumption during crop year 2021-2022.

“In recent years, the United States has been the sole export market for Philippine raw sugar,” the USDA’s Foreign Agricultural Service stated in a report published by the Global Agricultural Information Network (GAIN).

According to the sugar tariff rate quota, the country obtains an allotment of 142,160 metric tons raw value.

The USDA kept the country’s raw sugar production at 2.1 million MT for the same time, a 2% decrease from the previous year’s figure of 2.14 million MT. It also stated that the sugarcane area for the marketing year will remain at 390,000 hectares.

The drop in raw sugar yield was linked to the La Nia phenomena, which the Philippine Atmospheric, Geophysical, and Astronomical Services Administration predicted will reappear in late October or November.

“This coincides with the start of peak milling, when excess water will result in lower sugar recovery,” said to the USDA.

Sugar imports, on the other hand, are expected to be 100,000 MT for the same time period.

“This reflects the decision to not allocate any sugar production to exports; traders will therefore not be allowed to import refined sugar in an export replenishment program,” the USDA explained.

The USDA also predicts that the country’s sugar demand would rise by 100,000 MT to 2.3 million MT.

“Consumption will modestly increase as the economy recovers from the pandemic, which will drive the food and beverage manufacturers to increase production and sugar usage. As the economy reopens, businesses will resume operations, particularly the institutional buyers such as restaurants and hotels which were severely affected by Covid-19,” it added.

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