Sugar imports increase due to lower tariffs

THE COUNTRY’S sugar imports increased by 24.11% to 26,453 metric tons in 2012 due to a lower tariff on sugar, equivalent to the production of some 3,000 farmers, sugar industry stakeholders said.

Another 52,631 mt of high fructose corn syrup, a softdrink sweetener, was imported from January to November last year, a statement from the Sugar Master Plan Foundation Inc. (SMFI) said. This volume is equivalent to the production of 3,333 farmers, it said.

Under Executive Order 892, sugar tariff rates are to be gradually reduced to 5% in 2015. In 2012, tariff rate on sugar imports was set at 28%. This year, it is set at 18%.

"Sugar imports from other countries are subsidized by their respective governments while domestic producers are not," SMFI Executive Director Felixberto T. Monasterio said in a telephone interview yesterday.

According to Mr. Monasterio, the Philippines’ biggest competitor is Thailand, a country where sugar farmers are provided with farmgate price protection, retail price setting, direct financial assistance in the form of bank loans and sanitary and phytosanitary protection against imports.

"We are asking for the government to support us," Mr. Monasterio said, "we are not asking the government to subsidize the sugar industry, what we are asking is for them to provide us with assistance."

Mr. Monasterio said that the sugar industry has already submitted a proposed Sugar Cane Act which will provide the Sugar Regulatory Administration (SRA) with the necessary funds to support the sugar industry. Under the proposed Sugar Cane Act, part of the government’s revenues from the value added tax (VAT) will be transferred to the SRA. This fund will then be used for research and development of sugar products, loan facilities and various sugar assistance programs.

The SMFI is supporting SRA’s block farming project which aims to consolidate Agrarian Reform Beneficiaries engaged in sugar cane production, a project, he says, which will help small farmers.

"When small farms are unified to have single operations of 50 to 60 hectares under block farming, sugarcane farming can achieve economies of scale," Mr. Monasterio said, adding that under this project, farmers will share the same tractors and land preparation equipment and be able to sell to bigger markets because of their combined production.

He also said that with the SRA’s target of 2.358 million mt of sugar production by 2013, the sugar export industry must be developed further as domestic consumption is estimated at only 2.1 million mt.

SRA officials were not immediately available for comment.

source: bworldonline