BACOLOD CITY: The Sugar Alliance of the Philippines is asking for “proper consultation” as it found the proposed “win-win” solution of Agriculture Secretary Emmanuel Piñol “unacceptable and continues to reek of preference for the beverage companies rather than for sugar farmers.”
In a statement, the SAP on Friday said “Secretary Piñol seems to be seeing only one side of the equation, and unfortunately that side favors the multinationals rather than the sector he needs to be protecting.”
The group, composed of leaders of the sugar industry in the Philippines, was reacting to the latest announcement of Piñol that “big beverage firms have expressed willingness to buy more locally produced sugar—at lower prices.”
Piñol said Coca-Cola FEMSA Philippines and Pepsi Cola plan to purchase their sugar requirements for next year in advance, to ease the pressure on sugar planters who have been complaining of the drop in prices of the sugar because of the entry of high-fructose corn syrup (HFCS) from China.
He noted that HFCS accounts for 90 percent of Coca-Cola’s production while sugar accounts for the rest, 10 percent.
“They [Coca-Cola] offered to increase their consumption of local sugar from 90:10 to 80:20,” Piñol said, adding that “both softdrinks manufacturers, which have relied on HFCS since 2010 when prices of local sugar doubled, would need at least six months to restructure their production processes.
“They just need enough time to adjust their processing, manufacturing process… they need to install new clarification machines to convert raw sugar to syrup that can be used in their softdrinks,” Piñol explained.
The group, however, said “we have been calling for ‘proper consultation’ and we are taken aback by these pronouncements from the Secretary sans a dialog, foremost with the affected parties, and in this case, the sugar industry stakeholders.”
“We take offense at the offer of Coke to increase their consumption ratio from 90:10 to 80:10 when then, they have been producing their beverage at 80:10, 80 being sugar,” it added.
The group said, “Our farmers have been bleeding since sugar prices have dropped to P1,300 from P1,800 per LKg since the start of the crop year. Can’t the Secretary see what six more months will do to the very farmers he is mandated to protect?”
The SAP pointed out that ‘D’ sugar, which accounts for 20 percent of the country’s produce, is currently valued at P900/LKg while ‘B’ sugar, which is 74 percent, is at P1,400 level. The remaining six percent is ‘A’ sugar, which falls under the US quota.”
Local sugarcane producers said that for the past six years, beverage makers and food processors imported almost 800,000 metric tons of HFCS into the country, displacing the demand for 23 million 50-kilo bags of locally produced sugar and depriving the country, particularly the sugar industry, of P35.2 billion in potential income.
For the current crop year alone, HFCS importation has pulled down sugar prices from P1,800 per bag to about P1,400 per bag, translating to potential revenue losses of about P20 billion.
EUGENE Y. ADIONG