President Ferdinand Marcos Jr. on Sunday said the country will maintain a two-month buffer stock of sugar to avoid shortages in the future.
“We will maintain from now on, in sugar, a two-month buffer stock to avoid price speculation,” the President said in a media interview onboard PR001 en route to Davos in Switzerland for the World Economic Forum from January 16 to 20.
He did not elaborate how this will be attained but said the government is also looking at ways to increase the production and eventually, supply of agricultural products like sugar and onion and to stop rampant smuggling .
He said the government is looking at some “very good ideas, ”
including strategies implemented by other countries, suggested to curb smuggling.
The President added the Bureau of Customs is undergoing digitalization which will help address smuggling.
In a meeting last week, Marcos assured representatives of the Private Sector Advisory Council the government is committed to “do something to decisively address rampant smuggling.”
He ordered reforms in the bureaucracy to curb smuggling, lower logistics costs and ensure the ease of doing business.
The President said the government also intends to help the sugar industry and onion growers to increase production to reduce importation until it is no longer necessary.
He did not elaborate but said the country had been too dependent on importation following the pandemic and armed conflicts abroad as well as the elevated prices due to inflation.
Danilo Fausto, president of the Philippine Chamber of Agriculture and Food Inc., said government should have implemented strategic buffer stocking for basic commodities, including sugar, “a long time ago.”
Fausto said this will ensure stability of commodity prices.
Enrique Rojas, president of the National Federation of Sugarcane Planters (NFSP) said in the sugar industry, “we always target a production that will leave us with a buffer stock of at least two months at the end of milling by the end of August.”
Rojas said most sugar mills stop operations about June or July when they run out of canes to mill and when the new crop year starts on September 1, sugar mills do not simultaneously start operations as they only do so when assured of sufficient cane supply.
“Most Negros mills usually resume operations in last week of August or in September, while other mills resume operations in October, November or even as late as December. It takes about two or three months from September for all mills to simultaneously operate and produce sufficient sugar for domestic consumption,” Rojas added.
The NFSP said buffer stocking is needed to supply the domestic market while sugar mills have not yet achieved peak production.
The absence of buffer stocks “is precisely what caused domestic sugar prices to increase to unprecedented levels last July 2022 up to now,” the group said.
Based on the Department of Agriculture’s monitoring of public markets in the National Capital Region, prevailing retail price ranges as of Friday at P90 to P110 per kg for refined sugar, P83 to P95 per kg for washed and P80 to P97 per kg for brown. With Jed Macapagal
