Are they ready?

With the Sugarcane Industry Development Act of 2015 now in effect, there is a ray of hope for the sugar producers. That is at least what the leaders of the industry are assuring the planters, the businessmen and the workers with the passage of this Act. The leaders were profuse in thanking the President for finally acting on the bill that had languished in Congress for over three years. Only the patience of its main proponent, Cong. Alfredo Benitez in steering this bill led to its passage. Of course it underwent several revisions but at last there it is with its aspirations as well as its limitations and controversial provisions.

Last week Frank Carbon, the president of the Metro Bacolod Chamber of Commerce took me aside while I was waiting for the ship for Iloilo. He opened with a direct question: Is there hope for the sugar industry with this new law?

I did not hesitate to say there is, but with a caveat: if the objectives and resources mandated by the law are implemented. For in truth there is hardly much new in the law that had not been said, proposed, adopted and tried before. But as this law proves, the industry was unable to prepare enough to be able to adopt, adapt, anticipate, prepare and harness the benefits brought about by the drastic changes in international agricultural standards and trade.

In fact the larger question is whether the sugar producers, the government, the Sugar Regulatory Administration and the Department of Agriculture are ready for the task ahead that will make this law work.

I asked him whether he has seen the reported “road map” of the industry and he said he has not. That is not surprising because it seems this road map is better heard and read about than seen and studied to exploit the human, financial and technical resources of the industry to make this law work for the producers and consumers.

I was asked the same question 25 years ago and the question remains valid today: can the various interests in the industry put their acts together?

I was sorting out my collection of documents and found a written question and answer paper. The late Eduardo Ledesma, a sugar planter and miller, requested in 1994 that I write the questions and he will answer in writing as well. Fortunately I did and now I have his mind on the issue of the ASEAN Free Trade. It was the time when the Senate was debating on the Resolution to ratify the World Trade Organization agreement that the Philippines signed in April that year after the Uruguay Round of negotiations.

I asked: will the sugar industry be ready when the ASEAN Free trade takes effect? He said it would be if production per unit of land is high, mills are efficient, there is irrigation, we mechanize, there are high yielding cane varieties (HYV)), etc.

In sum he was talking of the same solutions that are still being bandied about by every sector of the industry and provided for in the Benitez law. That until now the industry is still proposing what Dading Ledesma recommended in 1994 shows that the industry did not prepare for this inevitability.

At the time of the collapse of the Philippine Sugar Commission in 1986, Philippine production hovered around 2.0 to 2.1 million tons. This data indicate that our sugar production is almost stagnant. We are producing only 2.35 million tons today, indicating scarce significance in terms of improved production.

On the other hand, domestic consumption due to annual population growth continues to rise from 1.6 tons (1986) to 2.2 tons today. Acreage of sugar land has been declining and during the last five years, new users of sugarcane have been increasing. There is a new player in the industry – ethanol plants that use molasses as feeder stock. We lost sugar lands to roads, subdivisions, other crops and industries.

There are plans to process sugarcane directly for ethanol which would be cheaper. Thus ethanol will eventually compete for sugarcane. The new law tries to balance this new situation but the question now is not the allocation but the available sugar to be apportioned.

We are running out of sugar even for our table. The rise in prices in the retail markets shows this, the denials of the SRA notwithstanding.

We'd like to see better days from the data but we see haze. How can we part this veil? Sugar history, shunted aside, would have answered.*

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