High global sugar prices seen to prevail in next two years

MANILA, Philippines – High global sugar prices are likely to prevail for the next two years, according to Sugar Regulatory Administration (SRA) head Rafael Coscolluela.

In a Sugar Industry Stakeholders Forum on the 2010 Tariff Reduction, Coscolluela urged sugar producers to take advantage of the high sugar prices in the next two years to prepare for the impact of trade liberalization.

Coscolluela said that revenues from high sugar prices should be used by sugar producers to improve their efficiency and competitiveness.

According to Coscolluela, domestic sugar prices (specifically refined white sugar), which was recently increased to P41 per kilo would remain at that rate, but would not likely increase any further.

Coscolluela told The STAR, that supply is beginning to normalize with some 243,000 tons of raw sugar, equivalent to about two months worth, available.

However, Coscolluela acknowledged that supply of refined white sugar still remains a “little tight.”

However, he assured that with the milling season about to start next month for millers in Luzon and Mindanao, supply of refined white sugar would finally ease up.

With the start of the milling season and as sugar supply eases up, Coscolluela said that the SRA would also decide next month if it would have to set aside anywhere from 10 percent to 15 percent reserve sugar.

At this time, Coscolluela said, the SRA has not set aside any reserve sugar because of the current tightness.

Every year the SRA classifies sugar into three categories, “A” for export to the United States, “B” for domestic sugar and “C” for strategic reserves. –Marianne V. Go (The Philippine Star)