Downtrend in sugar prices expected
MANILA -Selling prices of sugar in retail markets should decrease owing to the decline in prices received by producers at the mill gate, the Philippine Sugar Millers Association (PSMA) said on Tuesday.
“Given the lower mill gate prices of sugar at the start of the current crop year 2023-2024, which started on Sept. 1, there should be downward adjustments in retail sugar prices,” PSMA executive director Jesus Barrera said in a statement.
Barrera said in the first six weeks of the new season, mill-gate prices of sugar were “way below” than in the previous season.
“There is a lag time for the retail market to mirror lower mill gate prices as the sugar moves through the supply pipeline; but nevertheless, there should be market adjustments in the retail prices,” he added.
Data from the Sugar Regulatory Administration (SRA) showed that the sugar mill gate price averaged P2,825.35 per 50-kilogram (LKg) bag. It has decreased by 2.8 percent from P2,745.06 per LKg as of Sept. 24.
In the past crop year, mill-site prices settled at the P3,000 per LKg level. The average mill-gate price reached P3,021.04 per LKg on Sept. 4, 2022 and subsequently climbed by 25.7 percent to P3,798.24 per LKg.
The declining mill gate prices at the expense of local producers alarmed the SRA and forced it to hold the release of 150,000 metric tons of imported refined sugar indefinitely. It was meant to safeguard the interests of farmers and millers while maintaining a reasonable volume of sugar for domestic use.
The SRA had said the average price of raw sugar was on the downtrend in the first two weeks of crop year 2023-2024, citing oversupply.
SRA administrator Pablo Luis Azcona said last week this had been triggered by the speculation that reserved sugars would be released.
“We have to ensure local supply and we have seen in the past seven months [that] farm-gate prices are going down and retail prices are maintained. So someone is profiteering somewhere,” Azcona said in a briefing in Bacolod City.
“We have not found any discrepancy so far. We might think of inspecting the balances on the
other warehouses holding on to domestic sugar so we can see if the numbers are actually
accurate,” he told reporters. INQ
