Will the government’s importation of more sugar finally make it affordable for consumers? Or will it enrich the trade cartelist like before?
The 150,000 tons of additional sugar is supposedly for buffer – standby for emergencies, shortages, and price spikes. We’ve heard that before.
The Sugar Regulatory Administration already imported such buffer stock for 2023. Still, retail prices are spiking to P100-P140 a kilo.
SRA Sugar Order No. 6, Feb. 15, 2023 states: “Section 4. Volume and Type of Sugar:
“4.1 Two hundred thousand metric tons (200,000 MT) shall be allocated to Consumers.
“4.2 Two hundred forty thousand metric tons (240,000 MT) shall be allocated as buffer stock, for release to consumers upon the approval of the SRA board.”
So what’s the new buffer for? Did SRA botch its data gathering?
There’s only one sugarcane planting-harvest-milling season per year, Oct.-May. Producers vary only by a few weeks in Cagayan, Tarlac, Pampanga, Batangas, Camarines, Ormoc, Iloilo, Capiz, Negros, Bukidnon, Davao, and Cotabato. SRA must research supply to determine if the country will export or import.
But favoritism marred Sugar Order No. 6. Agriculture Senior USec. Domingo Panganiban admitted choosing a month prior only three traders, from a three-page list of 120, to import 440,000 tons. Those three had met with President Ferdinand Marcos Jr. in Malacañang. A photo that went viral. Panganiban told senators that Marcos Jr. ordered him to limit the selection.
SRA usually holds open bidding, then allocates import volumes to one or two dozen traders. Panganiban preempted the process. That resulted in what Sen. Risa Hontiveros denounced as a “government-sponsored cartel”.
The favored trio landed Thai sugar at only P25,000 per ton then sold at P70,000. Profiteering P45,000 per ton, they raked in P19.8 billion from all 440,000 tons. Just like that, Hontiveros was exposed.
Consumers suffered. Procuring from the trio at P70 a kilo, wholesalers distributed at P85-upwards. Adding transport, other costs, and margin, retailers sold at P100-P140. Same as during last Christmas’ shortage, but higher than P70-P80 in Sept. 2022. In early 2022 before the Marcos Jr. admin, it was only P35-P50.
Malacañang and SRA not only let the trio set the minimum price but also kept it at P70,000 a ton, or P70 a kilo.
Efforts of anti-smugglers were wasted. DA ASec. for Enforcement James Layug and Customs had seized 9,827,000 kilos of contraband sugar in Nov. 2022-Feb. 2023. The government had not invested any capital in it. Valuating smuggled sugar at P100 per kilo, the government’s only loss was the five-percent import duty of P5 a kilo.
The government could thus have sold the stuff only that cheap.
Still, Malacañang and SRA retailed it in Kadiwa rolling stores in poor communities at the trio’s price of P70 a kilo.
Same with the 6,500 tons “smuggled” in Batangas by one of the trio before Sugar Order No. 6 came into effect. Panganiban made Customs return it to the trader, who sold it at P70,000 a ton, or P70 a kilo.
Panganiban barred industrial users from importing their own sugar, but instead buy only from the trio, Hontiveros bared. Result: prices of biscuits, juices, and other sugared foods inflated.
Will SRA set things right with the forthcoming 150,000 tons? Will consumers ever enjoy P35-P50-a-kilo sugar like only 15 months ago?
Jarius Bondoc is an award-winning Filipino journalist and author based in Manila. He writes opinion pieces for The Philippine Star and Pilipino Star Ngayon and hosts a radio program on DWIZ 882 every Saturday. Catch Sapol radio show, Saturdays, 8 to 10 a.m., DWIZ (882-AM).
