NFSP lauds SRA for 100% ‘B’ sugar allocation

NFSP lauds SRA for 100% “B” sugar allocationThe National Federation of Sugarcane Planters (NFSP) lauded the Sugar Regulatory Administration (SRA) for heeding the call of sugar producers to allocate 100% of sugar production this Crop Year 2021-2022 as “B” sugar intended for the domestic market.

“SRA issued Sugar Order No. 1, which allocates 100% of sugar production for the domestic market for this crop year. We are happy that SRA listened to the clamor of sugar producers for this sugar policy, which is more prudent and favorable to sugar farmers,” said NFSP President Enrique D. Rojas.

The Pre-Milling Crop Estimate for CY 2021-2022, which started yesterday and runs until August 31 next year, projects that sugar production will only be 2.1 million metric tons due to the La Niňa weather phenomenon, which is characterized by more than average rainfall. If sugarcanes are soaked in rainfall, they yield a lower sugar content.

Last July, PAGASA warned of “more than fifty percent (50%) chance that La Niňa will develop in either October or November 2021, which may last through the first quarter of 2022.” This period marks the start and peak of the milling season in the sugar industry.

The forthcoming La Niňa is expected to lower the average national sugar recovery to only 1.71 LKG/TC, the actual average national sugar recovery for CY 2020-2021 when the industry was also hit by La Niňa. Thus, the 2,1 million mt estimated production this crop year varies only slightly from the 2,138,147 mt actual production in CY 2020-2021.

In CY 2020-2021, SRA mandated the 5% allocation for “A” Sugar (US Market) at the start of the crop year, and then eliminated the “A” sugar allocation on March 29, 2021 near the end of the milling season. The “A” sugar allocation caused losses to sugarcane farmers, because “A” sugar prices are lower than “B” sugar prices.

“We laud SRA for its prudence in allocating all of our production for the domestic market. This allocation spares the sugar producers the losses they suffered last year arising from selling a portion of their sugar production to the US market at a lower price, compared to the more reasonable sugar prices in the domestic market,” Rojas explained.* (Butch Bacaoco)