Bacolod City – The Sugar Regulatory Administration (SRA) appears powerless as sugar prices continue to decline in the local market.
SRA Administrator Pablo Luis Azcona told reporters recently that the agency’s role is limited to addressing supply issues.
“If we implement programs that can affect supply, maybe it will influence the price,” Azcona said.
However, he clarified, “As for pricing, we have no involvement. It’s not in our charter, so we really have no control over that.”
Azcona noted that the SRA will assess the total sugar production at the end of the milling season to determine if there is a need to import sugar, as well as the quantity and timing of any imports.
Predicting sugar prices remains challenging, according to Azcona.
“It’s difficult to predict how low the price of sugar will go. If it were up to me, the ideal, comfortable price would be around PHP 2,650 to PHP 2,700. But right now, prices are much lower; it’s already dropped to PHP 2,500,” he said.
He also pointed out that the production cost for small farmers, based on national estimates, is at least PHP 2,400 per bag.
“And we are nearing the threshold,” he added.
Azcona expressed frustration with the disparity between farmgate and retail prices.
“If you look at the supply and demand numbers, it should go up. But why isn’t it? It’s really difficult to say. The market is privately controlled,” he said.
He explained that wholesale and retail prices remain steady, while the farmgate price continues to drop.
“When we look at the graphs we’ve made, we can see that the wholesale price for raw and refined sugar is constant, and the retail price is also constant. But from wholesale to retail, there’s an easy PHP 500 per bag profit,” Azcona said.
“What’s disheartening is that the gap between farmgate and wholesale prices has widened significantly. Farmgate prices keep going down, but wholesale prices are holding steady,” he added.
Azcona warned that if prices fall further, small farmers might be discouraged from planting sugarcane, potentially shifting to other high-value crops.
“This would create an even bigger problem for us,” he said.
The high production cost of around PHP 2,400 per bag leaves little room for farmers to break even, making it hard for them to recover unless prices stabilize.
Azcona emphasized the urgency of addressing these issues to prevent long-term consequences for the sugar industry. (Dolly Yasa via The Daily Guardian)