Manila expects lower sugar production for the incoming crop year because of threats of a stronger El Niño in the latter part of year, the Sugar Regulatory Administration (SRA) said.
In a text message, SRA Administrator Ma. Regina Bautista-Martin said they expect sugar production to reach 2.3 million metric tons (MT) for the incoming crop year, lower than the 2.46 million target a year ago.
A sugar crop year in the Philippines starts September and ends August.
For crop year ending August 2015, the Philippines was able to produce 2.316 million MT—short of target 2.46 million MT.
This was caused by unfavorable weather conditions that affected major sugarcane plantations, particularly in the Visayas region.
The prolonged dry spell toward the end of the current crop year also impacted sugarcane crops.
“For the incoming crop year, our target will be roughly the same as our final output of 2.316 million MT,” Martin said.
The SRA adjusted downward sugar production estimates a couple of times in crop year 2014-2015.
It also cut export commitments to ensure stable supply in the domestic market.
Domestic demand for the sweetener–based on per capita consumption of 25 kilos for 88 million Filipinos–is around 2.25 million MT.
With output expected parallel with domestic requirement, the SRA may refuse exports to markets other than the United States.
On the other hand, Manila is expected to honor its commitment to supply Washington with enough sugar.
The Philippines is one of the select countries that are given an annual allocation of sugar export to the US market at a premium.
For this crop year, Manila has a regular US sugar quota of 138,827 MT.
Tariff-rate quotas allow countries to export specified quantities of a product to the United States at a relatively low tariff, but subject all imports of the product above a pre-determined threshold to a higher tariff.