The Sugar Regulatory Administration (SRA) has allowed use of “D” sugar, which is earmarked for export to the world market, for production of ethanol.

According to SRA Sugar Order No. 5, “allowing the use of “D” sugar for ethanol will open an alternative market for excess sugar production.”

In crop year 2007-2008, sugar production hit a 25-year high of 2.455 million metric tons, resulting in a surplus or ending inventory of 611,000.

The ending inventory for every crop year should be around 300,000 metric tons, which is enough to meet a two-month requirement.

The SRA has been taking several measures to siphon off excess sugar from the market, including an early export program and reallocation of portion of the “D” sugar to “F” sugar for biofuel feedstock use.

The SRA has allocated seven percent of the 2008-2009 sugar production for export to the world market; 10 percent for “A” sugar, for the US market; 68 percent for “B,” for the domestic market; and 15 percent for “C,” or reserve sugar.

The “F” (fermentable) quedan is a new sugar classification put up by the SRA to ensure adequate feedstock supply to ethanol plants.

SRA Administrator Rafael Coscolluela said in an interview that the conversion of “D” sugar was allowed for the current crop year only and would be applicable to sugarcane to be harvested beginning Dec. 7.

A sugar crop year starts in September and ends in August the following year.

Coscolluela said the maximum volume that could be converted to “F” sugar was 64 percent of the “D” sugar stock.

Sugar traders or ethanol producers who intend to reclassify “D” sugar to “F” have to sent a request letter to the SRA, along with a bond that would ensure that the converted sugar would be used solely for ethanol production.

The bond will be returned upon the receipt and acceptance by the SRA of sufficient proof that the ethanol producer had used his “F” sugar only for ethanol production. With editing by INQUIRER.net