SRA moves to clamp down on sugar market speculators
MANILA, Philippines - The Sugar Regulatory Administration (SRA) may impose regulatory measures to curb market speculation as sugar millsite prices have risen this month.
SRA administrator Regina Martin said there is no reason for the millsite prices of domestic or “B” sugar to rise because the country has sufficient sugar stocks to meet domestic demand.
“This is alarming, but hopefully this will taper off. We just want to make sure that retail prices do not go up. We are also worried that (industrial) buyers may shift to alternative sweeteners or import sugar,” said Martin in a phone interview yesterday.
The average millsite prices of domestic or “B” sugar has risen to as much as P1, 800 per 50-kilogram bag last week from P1, 600 per 50-kilogram bag on April 3 and P1, 500 per 50-kilogram bag on March 27.
“This is inspite of the fact that we will have enough sugar stocks to meet our domestic demand,” said Martin.
The rise in millsite prices of domestic sugar, she said, would encourage smuggling of cheaper foreign sugar.
“If millgate prices rise, there will be smuggling,” said Martin.
After the onslaught of Typhoon Yolanda in November last year, the SRA has increased the domestic sugar allocation for crop year 2013-2014 to protect local supply and prices as lower production is expected this year.
To be diverted to the local market is 92 percent of the production for the current crop year.
Sugar production has been delayed for the current crop year but the SRA is confident that its estimated production of 2.356 metric tons of sugar this crop year would be attained.
“Thus there is no reason for prices to go up,” said Martin.
She said the SRA is closely monitoring sugar production and withdrawals from warehouses, including shipments.
SRA personnel have also been ordered to verify the physical stocks in sugar warehouses.
“Should prices continue to rise, the SRA is considering actions within its power to curb the speculation,” said Martin. “We do not wish to announce our options for the meantime but this is a warning to speculators.”