Amid speculations on the oversupply of sugar and the decrease in the farmgate prices, Wennie Sancho, Convenor of the Save the Sugar Industry Movement (SAVE-SIM) called for an investigation to allay fears of price manipulation.
Sancho further alleged that “somebody is gaming the market” in the sugar industry.
“Gaming” the market in the sugar industry allegedly refers to unethical practices that manipulate prices, supply or demand to gain an unfair advantage. The winners are the large sugar traders and middlemen. They manipulate prices, control supply, and profit from the difference.
Unscrupulous producers and importers benefit from artificially low millgate prices, exploiting small farmers and consumers. Influential industry players who are using their political connection or market dominance to influence policies and prices, cartels, syndicates, collude to control prices, limit competition and maximize profit, he said in a press release.
The losers are the marginal sugar farmers, the ARBs who received low farmgate prices, struggle to cover costs and risk bankruptcy, Sancho added.
Consumers face higher prices, reduced quality or limited access to sugar products. Honest producers struggle to compete with manipulated prices potentially leading to business closure. The local economy will suffer from reduced revenue, employment, and economic growth, he said.
Government loses revenue from taxes due to manipulated pricing. Under the “game,” the order of the day would be price fixing, supply hoarding, artificial demand creation, misinformation/disinformation, import-export manipulation, Sancho said.
The consequences are distorted market prices, reduced competition, inefficient allocation of resources. Decreased investors confidence and negative impact on economic growth. There are manipulations gaming the market to create artificial shortage of sugar at a time when the demand is high during the Christmas season, he said.
In 2022 Senator Riza Hontiveros investigated the arrival of 5,000 metric tons of sugar at Batangas Port ahead of the sugar order issuance. The controversy involved unauthorized importation, alleged smuggling, possible inside trading. The investigation highlighted concerns about weak regulations, corruption and industry influence on policy makers, Sancho said.
The Senate investigation calls for stricter regulations and enforcement, SRA increased monitoring and surveillance. DA and BOC investigation however, ended with no specific outcome such as conviction or prosecution, he said.
Despite challenges, efforts should continue to combat sugar smuggling and price manipulations. Advocacy and public pressure can help ensure accountability, he added.
Sancho asserted that amid allegations of “gaming” the market, advocacy and public scrutiny should continue to push for greater accountability and reform in the sugar industry. We must save Negros and the sugar industry, the lifeblood of our economy. (News & photo courtesy of SAVE SIM PR via The Visayan Daily Star)