SRA talking points

Recall the report that the Sugar Regulatory Administration has constituted as committee composed of its own experts and representatives of the various federations of the sugar industry. The SRA has not published the results of this consultation.

I asked about this and but the SRA has no public information office when it should have considering that its constituencies are spread out all over the country and it regulates a sensitive national commodity. The SRA, sadly, has been reported to have been downsized by more than a quarter of its original components.

Anyway, the National Federation of Sugarcane Planters has published its position on the three issues that the SRA furnished the various sugar groups for their thoughts on these talking points. I understand that the SRA will consolidate these positions with the feedbacks from other groups and then formulate a national plan.

There are three points that the SRA has asked the sugar groups to take a position on – productivity, marketing and economic zone. The NFSP has published its ideas on these points which are clear enough. The different groups have already met but what are the positions of other groups on these points? It would be interesting to see although we cannot be certain whether they will individually publish them or wait for the SRA’s consolidated outcome or a plan.

The three talking points of SRA indicate one thing – the bill filed by Rep. Albee Benitez and that of Rep. Pryde Henry Teves have not been embraced by the SRA or by the sugar industry sectors. The NFSP rejects a new law. The price control mechanism that Benitez proposed, however, can be adopted by the consolidated version as well as portions of the Teves plan, but indications do not seem to take these routes.

The economic zone proposal is something new. It can be viable as there are economic zones in the country that are doing fine. However what kind of economic activity can be developed here?

I think the idea is to make the existing sugar mills the core of the zone and from here serve the needs of a community of workers and industries. We shall wait what this zone will be but surely it must be sugar-based.

One of the issues that had been plaguing the industry is smuggling but has not been addressed in the talking points.

Scarce statistics on sugar production vis-a-vis consumption show that while our population is growing sugar production has remained stagnant and consumption per capita remains the same. This indicates little improvement in the socio-economic level as if most of those born after 1980 take little sugar or sugar-based products, like drinks, coffee, pastries, candies, etc.

The country produced about 2.3 million tons in 1980 and this year the estimated production is 2.4 million. In 1980 our total land area devoted to sugarcane cultivation was 382,439 hectares and in 2009-2010 the area had remained almost the same at 385,662 hectares. Some years the area goes up, sometimes it goes down. For the last ten years (2001-2010) lands planted to sugarcane have averaged 384,014, according to SRA.

These figures tell us the stagnation of the sugar industry although our population goes up by about one million each year though it is just 96 million last year.

In 1980 our consumption was reported to be 750,000 tons while our population was about 50 million, about 15 kg per person. Projecting our consumption should be 1,44,000 tons now and last year the SRA set 1,728,000 tons for domestic consumption with another 480,000 tons for reserve. The estimated production is 2.4 million but this can go down and in fact many say this will go down.

The other year we imported about 150,000 metric tons supposedly due to a shortage as our production was estimated at 1.9 million. But there was no shortage and prices collapsed this time last year. Prices are now stable and so far there are no complaints from the industry. The fiasco of last year’s estimate had created a fracas.

There are no readily available statistics on our sugar consumption today. I used only the 1980 data but these show a low consumption and stagnating production and acreage that have remained unchanged since 30 years ago. If the acreage and production levels remain the same and the consumption patterns do not change, the industry will be in greater danger once imported sugar comes in.

The propositions of NFSP are realistic but there are issues that need to be addressed. They are the minimum but unless addressed can be catastrophic in the end.

The challenges to stakeholders are issues and developments that are more than the parameters that SRA set, like the problem of labor, expanding agrarian reform, housing and industrial space demands and consumption in relation to production and marketing lest they be like Sisyphus. Anyway let us wait awhile.*

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