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DA allocates 440K MT of refined sugar imports to only 3 handpicked entities

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THE Department of Agriculture (DA) is allocating the 440,000 metric tons (MT) of refined sugar imports to only three entities – All Asian Countertrade Inc., Edison Lee Marketing Corp. and  Sucden Philippines Inc. – which were earlier revealed to have been “handpicked” by a high-ranking official.

In a memorandum to Sugar Regulatory Administration (SRA) Administrator David John Thaddeus P. Alba, Senior Agriculture Undersecretary Domingo F. Panganiban directed the issuance of clearance for release of imported sugar under Sugar Order (SO) 6.

Panganiban’s memorandum, dated February 27, stipulated that the SO 6 import volume shall be allocated to the three entities following the Memorandum issued by the Office of Executive Secretary last January 13.

The memorandum, a copy of which was obtained by the BusinessMirror, showed that All Asian Countertrade Inc. shall import 240,000 MT, while Edison Lee Marketing Corp. and S&D Sucden Philippines Inc. shall import 100,000 MT each.

Furthermore, Panganiban said the sugar shipments consigned to All Asian Countertrade Inc. that have already arrived in the country shall be part of the importer’s 240,000-MT allocation under SO 6.

A SRA clearance is necessary to allow the entry of imported sugar to the country as it certifies that the shipments are legitimate or part of an authorized import program, which is usually done through an SO. 

An SRA clearance usually bears the initial classification of the imported stocks as well as the total import volume allocated to an importer.

However, an SRA clearance does not automatically mean the imports can be directly sold to the local market as the shipments would have to undergo the so-called reclassification process of the SRA board.

Imported sugar stocks are automatically classified as “C” sugar or reserved sugar and should be reclassified by the SRA board as “B” sugar, or sugar meant to be used for domestic consumption prior to local market sale or use.

Only one import program

SRA board member Pablo Azcona, who represents the planters sector, said Panganiban’s latest memorandum clears the air that there is only one sugar import program, which is the one authorized under SO 6.

Panganiban’s press conference last week stirred confusion in the sugar industry on whether the import program he disclosed was separate from SO 6. If there were two separate sugar import programs, the total import volume would have reached nearly 900,000 MT.

For Azcona, Panganiban’s memorandum to Alba already represents the final approved allocations under the SO 6 sugar import program.

Section 5 of SO 6 stipulated that the allocation of import volumes per importer shall be approved by the DA. The SRA board shall only recommend the allocation per eligible importer.

Azcona said the SRA board recommended about 8 to 10 accredited importers to receive allocations.

He pointed out that the number of entities allowed to import under the import program is not an issue, since the imported stocks would still have to be reclassified by the SRA board before they can be sold to the domestic market.

“The farmers’ main concern is volume and re-classification into B sugar. Arrival is not a concern since the sugar is C or Reserved, and cannot be sold. It cannot be sold unless reclassified by the Sugar board,” he explained.

“Farmers are not traders or importers, so the only people who might complain are those who trade or those who wish to have been importing too,” he added.

What went before

Last week, it was revealed that Executive Secretary Lucas P. Bersamin wrote a memorandum to Panganiban in January ordering the implementation of a sugar import program to pull down the elevated prices of the commodity and dampen its inflationary pressure.

In a press conference last week in Malacañang, Panganiban said he picked the three “capable” sugar importers from a list of accredited importers to bring in 450,000 MT of sugar even without an approved SO authorizing an import program yet.

Panganiban confirmed the details of the earlier exposé of Senator Risa Hontiveros, saying the said firms were allowed to do so on the condition they “reduce the prices of sugar, sell the commodity, and shoulder the cost of warehousing.”

“In response to the directive of the President to address inflation and create a buffer stock and given that sugar is one of the components of most of commodities that drives the consistently high inflation rate, I acted with haste and interpreted the memorandum issued by the Office of the Executive Secretary as an approval to proceed with the importation,” he said.

“The directive was for them to bring it at a time that the sugar in the country is being harvested and that will be coming in February, March, and April,” he added.

Earlier last month, Hontiveros revealed that the DA allowed All Asian Countertrade, Sucden Philippines Inc., and Edison Lee Marketing Corp. to import about 450,000 MT of sugar, supposedly upon the instructions of President Marcos, Jr. through a memorandum signed by Bersamin.

Certain sugar shipments consigned to one of the three entities have arrived in the country as early as February 9, almost a week before the SO 6 was approved by the SRA board.

Hontiveros argued that the importation might be considered as “government-sponsored” smuggling since it did not go through the usual procedures.

However, Panganiban said that Marcos, who chairs the SRA board in his concurrent capacity as the agriculture secretary, was well aware of the arrivals of the sugar imports.

“Yes, he was aware. The sugar arrived on February 9. He was properly informed that the sugar had already arrived,” Panganiban said. 

Image credits: Amarin Jitnathum | Dreamstime.com

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