Sugar output may dip 11%

THE Philippines, Southeast Asia’s second-biggest sugar exporter, lowered its output forecast by about 11 percent, after heavy rains curbed production of cane milled to make the sweetener, a government official said yesterday.

The forecast for the crop year that began in September was lowered to about 1.97 million metric tons from 2.23 million tons in August, Sugar Regulatory administrator Rafael Coscolluela said in a telephone interview.

Lower production may reduce the Philippines’ exports, worsening a global shortfall and helping support a 3.6-percent gain in prices that made sugar the third-best performer on the UBS Bloomberg CMCI Index, which tracks 26 commodities, in the past three months.

“We expect lower tonnage of sugarcane because of the weather,” Coscolluela said.

“We’ve been hit by heavy rains since September.”

Raw sugar for delivery in March added 0.4 percent to 12.03 cents a pound on the ICE Futures Exchange in New York Thursday. Refined sugar rose 0.9 percent to $336.90 a ton in London.

Global demand for sugar would outpace production by as much as 3.6 million tons in the season started Oct. 1, the International Sugar Organization said on Nov. 11.

The Philippines was hit by 11 weather disturbances between September and December, including storms and typhoons, according to the Philippine Atmospheric, Geophysical and Astronomical Services Administration.

The nation planned in August to export 207,000 tons of sugar this year to curb domestic supplies after prices fell. The export target was based on the assumption that output would be 2.23 million tons. The nation consumes around 1.9 million tons of sugar a year.

The domestic price of refined sugar has risen to P37.50 a kilogram on Jan. 5 from P33.71 on Dec. 3, according to government data. Bloomberg