Sugar stakeholders seek Palace assistance

Some 100 sugarcane industry stakeholders asked the support of the Department of Agriculture during a recent dialogue in providing the necessary equipment in the mechanization of sugarcane production for both sugar and ethanol. Sugarcane farmers, particularly members of sugar Mill District Development Committees (MDDCs), said that the government should help them acquire tractors, irrigation systems and trucks, citing that mechanization and ethanol production are keys to a more sustainable and globally competitive sugarcane industry.

There are 30 MDDCs throughout the country, composed of farmers, millers and other stakeholders.

Other farmers also clamored for more farm-to-market roads in major sugar-producing provinces for faster and more efficient transport of cane to the mills.

As source of fund to bankroll their equipment needs, the MDDCs proposed that the performance bond and service fees from sugar imports be turned over to the Sugar Regulatory Administration.

Currently, sugar imports are done by the National Food Authority.

The MDDCs will submit their proposal to Agriculture Secretary Proceso Alcala for his consideration and endorsement to President Benigno Aquino 3rd for approval.

Meanwhile, they are optimistic on increasing the country’s production of ethanol.

Under the Biofuels Act of 2006, fuel companies are required to blend ethanol with gasoline, at 5 percent this year, and 10 percent next year.

Current ethanol demand is estimated at about 219 million liters versus domestic production of merely 80 million liters, derived from sugarcane and molasses.

Next year, demand would more than double to 460 million liters of ethanol, the group noted.

Members of the Ethanol Producers Association of the Philippines have complained that current tariff on imported ethanol is too low, at only 1 percent, hence pricing out locally produced ethanol.

They propose that it should be increased to 20 percent to protect the local ethanol industry, and attract more investors to the country.

Also, ethanol producers are asking immediate issuance by the Department of Energy of a circular on new set of guidelines to import ethanol.

They said that the Energy department has conducted several consultations on the matter, but until now it has not issued the circular.

Importers had been using the old Energy department guidelines prior to the enactment of Biofuels Act of 2006.

Small farmers also requested more accessible and affordable credit to enable them to buy high-yielding sugarcane seeds, fertilizers, farm inputs and post-harvest equipment.

Alcala said that the Agriculture department will seriously consider the request.

He enjoined the small farmers to organize themselves into clusters or cooperatives so they could avail of needed financial assistance.

Alcala initiated the dialogue—a follow-up to an earlier meeting held in July—to address major concerns and map out industry directions to increase production of sugarcane and ethanol, achieve stable domestic supply and prices of sugar and increase farmers’ incomes.

He said that these goals are all geared toward making the country’s sugar industry globally competitive, in the light of the implementation of the Asean (Association of Southeast Asian Nations) Free Trade Agreement.

Tariff rates on imported sugar from competing Asean member-countries will be gradually reduced from the current 38 percent to only 5 percent by 2015.

By 2012, tariff rate will further go down to 28 percent, 18 percent by 2013, and 10 percent by 2014.

Asean groups Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. –JAMES KONSTANTIN GALVEZ REPORTER, Manila Times