THE Pason Multi-Purpose Agricultural Cooperative (MPAC) appealed for intervention of the Sugar Regulatory Administration (SRA) in setting a minimum buying price of at least P600,000 per 50-kilogram bag (Lkg) or more for the conversion rights of the sugar producers in converting their "D" world market sugar to "B" domestic sugar.
In a letter to SRA administrator Hermenegildo Serafica and Pason president Luis Garingalao stated, "almost all of the "D" quedans produced during the crop year have already been bought by the traders and the sugar farmers are under pressure to sell their conversion rights to the traders at very low prices, otherwise the traders will not buy their conversion rights."
The going rates at present are from P250 to P400 per lkg.
"It is quite insulting and demoralizing to the sugar farmers that the amount the sugar traders are offering to buy their conversion rights are crumbs compared to what they will be making. In many instances, many of the sugar producers are forced to sell to the traders at these low prices offered by the traders because, otherwise they are told, that their rights will be shut out. The traders already made tremendous profits in buying our "B" quedans during the milling season. Now, they still want to make a killing in buying our conversion rights," Garingalao said.
The sugar farmers, who have suffered big losses during the crop year, appeal to the SRA that they will be given fair treatment by the sugar traders. It is the mandate of the SRA to give fair treatment to all sugar industry stakeholders, he added.
Moreover, Garingalao and Franklin Puentevella, chairman of Pason Multi-Purpose Cooperative, said they are projecting an eight percent drop in production in this coming crop year due to the delay in the milling of many sugar farmers and the low sugar prices during the crop year that just ended.
"We expect that the coming year 2017-2018 will not be good compared to the previous year as the production of the areas that have been harvested late will be low. In some cases, due to manpower shortages, the canes were not all harvested. Also due to the onset of the rainy season, some areas were idled or were just being rationed instead of being replanted. With the rainy season, the growth of the sugar plant in the areas that were harvested late will be stunted," they said.
Due to the control measures that have been adopted by the SRA and that campaign of the sugar industry against high fructose corn syrup, we project that the withdrawal of the "B" sugar will increase by seven percent.
However, this projected increase will be negated if the proposed tax on beverages will be passed and implemented. In such event, there might be a need for the SRA to impose a world allocation to remove the excess volume that might result because of the drop in sugar consumption.
Based on the assumptions, "we are projecting an ending inventory of 119,000 metric tons at the end of the incoming crop 2017-18. At this projected ending inventory level, we believe that "B" prices for this coming year will be able to recover towards the middle of the crop year, they said.
