Imports, pests and alternative sweeteners threaten PH sugar industry
The Philippine sugar industry faces six overlapping systemic stressors that threaten farmer livelihoods, cooperative strength and national food security.
Overimportation during crop year 2025-26 depressed farmgate prices by 38%, inflicting ₱7.28 billion in direct losses and ₱19.78 billion when indirect costs are included.
El Niño-related losses projected for 2026-27 range from ₱2 billion to ₱4 billion in direct yield reductions and from ₱7.1 billion to ₱11 billion when indirect effects are considered.
An infestation of the red-striped soft scale insect (RSSI), Pulvinaria tenuivalvata, threatens up to 390,000 metric tons of sugar valued at ₱15.6 billion under a worst-case scenario.
Rising fertilizer and logistics costs, driven by global oil price increases linked to the U.S.-Iran war, add an estimated ₱3.5 billion to ₱5 billion in expenses. A recent wage increase has raised labor costs by an estimated ₱2 billion to ₱3 billion, further reducing farmers’ margins.
Alternative sweeteners now account for an estimated 35% to 52% of total sweetener consumption, displacing the equivalent of 770,000 to 1.144 million metric tons of cane sugar annually and translating into ₱20 billion to ₱30 billion in lost farmer revenue.
This paper integrates the six stressors into a hexagonal framework. It identifies governance failures involving overimportation and unchecked sweetener imports as the most financially damaging pressures, compounded by escalating input costs, labor expenses, climate variability and pest infestations.
Its policy recommendations emphasize climate-sensitive trade governance, stronger cooperatives, input-cost stabilization, labor protection, integrated pest management and the regulation of alternative sweeteners to protect farmer livelihoods and promote the industry’s long-term resilience.
Introduction
The Philippine sugar industry is at a critical juncture as it faces overlapping pressures from governance failures, climate variability, rising input costs, invasive pests and market displacement by alternative sweeteners.
Economic shocks such as currency depreciation, rising debt-service costs and stagflation combine with geopolitical crises, including the U.S.-Iran conflict’s effect on fuel prices, and climate risks such as El Niño and typhoons to undermine agricultural productivity.
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The industry’s fragility stems from six interacting stressors: El Niño-related climate variability, RSSI infestation, high fertilizer and logistics costs, high labor costs, overimportation of refined sugar and the unchecked rise of alternative sweeteners.
Together, these pressures intensify one another, creating conditions in which governance failures, climate shocks, rising costs, biological invasions and market substitution erode farmer livelihoods, cooperative strength and national food security.
Methodology
This paper distinguishes observed data from estimates and scenario-based projections to promote clarity and credibility.
Observed data include historical records such as farmgate prices during crop year 2025-26, which fell from ₱65 per kilogram to ₱40 per kilogram, and confirmed infestation coverage of 61,000 hectares in Negros Occidental.
Estimates are based on current economic calculations, including a projected ₱3.5 billion to ₱5 billion increase in fertilizer and logistics costs based on prevailing oil-linked price increases.
Projections are scenario-based forecasts, such as the expected ₱2 billion to ₱4 billion in direct yield losses associated with El Niño in 2026-27.
Overlapping effects were distinguished to avoid double counting. For example, losses attributed to alternative sweeteners were calculated separately from price declines caused by imports, with adjustments intended to prevent displacement volumes from inflating farmgate-loss estimates.
Key stressors
Overimportation
Overimportation has been the most financially damaging stressor identified in the paper.
During crop year 2025-26, an influx of imported refined sugar depressed domestic farmgate prices by 38%, reducing them from ₱65 per kilogram to ₱40 per kilogram.
The decline translated into ₱7.28 billion in direct losses. When indirect effects such as weaker cooperatives, deferred mill investments, labor displacement and supply-chain contraction are considered, the total impact rises to ₱19.78 billion.
Mismanaged imports destabilized farm incomes and weakened the industry’s structural foundations, underscoring the need for climate-sensitive, evidence-based trade governance, according to GMA Integrated News and Mendoza.
El Niño
El Niño remains a recurring climate stressor that undermines sugar cane productivity.
The 2026-27 episode is projected to cause ₱2 billion to ₱4 billion in direct yield losses, primarily through reduced cane tonnage and sucrose content. Indirect costs are projected to increase total losses to between ₱7.1 billion and ₱11 billion.
Luzon is expected to bear the brunt of the losses, while the Visayas and Mindanao are expected to be buffered by Type III and Type IV rainfall regimes.
The projected regional differences highlight the importance of incorporating El Niño-Southern Oscillation rainfall data into production forecasts and trade decisions, according to the Philippine Atmospheric, Geophysical and Astronomical Services Administration.
RSSI infestation
The RSSI infestation has emerged as one of the most serious biological crises in the modern history of the Philippine sugar industry.
First detected in Pampanga in 2022, the pest spread to Negros Occidental by 2025 and developed into a provincewide calamity by mid-2026.
Infestations covered 61,000 hectares, reduced yields by 20% to 30% and threatened losses of up to 390,000 metric tons of sugar valued at ₱15.6 billion.
RSSI thrives under hot, dry conditions, with El Niño-related droughts creating favorable environments for population growth. Its parthenogenetic reproduction allows it to multiply rapidly, while its honeydew excretions encourage the growth of sooty mold, further impairing photosynthesis, according to El-Serwy.
The paper presents biological control using endemic parasitoid Hymenoptera species as a more sustainable approach to managing RSSI in Philippine sugar cane.
Unlike chemical drone spraying, which can leave residues in soil and water, harm pollinators and beneficial predators, and expose nearby communities to health risks, parasitoid-based control works through natural ecological processes.
The parasitoid wasps deposit eggs inside scale insects. Their larvae then consume the pests from within, gradually suppressing the population without chemical inputs.
Because the parasitoids are endemic to the Philippines, the paper says they are adapted to local conditions and could support long-term pest management.
Chemical spraying in the Philippines has been about 50% effective and requires repeated applications, according to the paper. Biological control, by comparison, could develop into a self-sustaining form of population suppression that reduces costs and ecological damage over time.
The paper recommends directing funding and research toward mass-rearing, release programs and farmer cooperative-led implementation of parasitoid control. It argues that these measures could strengthen biodiversity, reduce community exposure to chemicals and support climate-resilient agriculture.
Fertilizer and logistics
Rising fertilizer and logistics costs represent another systemic burden.
Fertilizer prices increased by 40% to 60% because of global oil-price escalation linked to the U.S.-Iran war, while logistics costs rose by 25% to 30%.
The increases imposed an estimated additional burden of ₱3.5 billion to ₱5 billion nationwide.
Farmers reduced fertilizer use and ratooning, contributing to yield declines and increasing long-term risks to soil fertility. Cooperatives struggled to procure inputs collectively, while mills faced higher operating costs, according to the U.S. Department of Agriculture.
Labor costs
Labor costs have also placed additional financial pressure on the industry.
A recent wage increase raised the costs of cane cutting, hauling and milling labor by 15% to 20%, translating into an estimated additional burden of ₱2 billion to ₱3 billion nationwide.
Although wage increases are essential to protecting workers’ welfare, they can reduce farm-level profitability when they are not accompanied by productivity gains or support for mechanization.
The imbalance has created tension between protecting labor rights and maintaining farm viability, according to BusinessMirror.
Alternative sweeteners
Alternative sweeteners account for an estimated 35% to 52% of total sweetener consumption in the Philippines.
The estimate is based on beverage-industry market-share reports from 2025 and 2026 and Association of Southeast Asian Nations import-clearance data under Chapter 17.02.
Displacement volumes were calculated by converting nonsugar sweetener consumption into equivalent cane-sugar tonnage using sweetness-equivalence ratios. For example, 1 kilogram of sucralose is considered equivalent to the sweetness of about 600 kilograms of sugar.
The substitution effect represents the annual displacement of the equivalent of 770,000 to 1.144 million metric tons of cane sugar and an estimated ₱20 billion to ₱30 billion in lost farmer revenue.
The paper identifies regulation as the primary concern. Weak tariff and labeling oversight allows duty-free entry of nonsugar sweetener products that reduce domestic demand for cane sugar.
Although health risks are discussed in global literature, the paper focuses primarily on governance. It recommends measures such as tariffs, import-clearance requirements and front-of-package labeling to balance consumer choice with farmer protection and industry resilience.
Table 1: Sweetener displacement and health risks
| Sweetener | Common use in the Philippines | Economic displacement | Key health risks cited in the paper | Policy requirement |
|---|---|---|---|---|
| Aspartame | Sugar-free juices and tabletop packets | Contributes to the displacement of the equivalent of 770,000 to 1.144 million metric tons of cane sugar and an estimated ₱20 billion to ₱30 billion in lost revenue | The International Agency for Research on Cancer classified it in 2023 as possibly carcinogenic, or Group 2B. The paper also cites a 22% increase in breast-cancer risk and a 15% increase in obesity-related cancer risk, as well as links to Type 2 diabetes, cardiovascular disease, mortality, gut dysbiosis, reduced insulin sensitivity and liver toxicity. | High regulatory risk; may face bans or labeling warnings and may not be viable for health-related branding |
| Sucralose | Zero-calorie sodas, instant 3-in-1 coffee and “no sugar” milk tea | Has the same displacement effect under duty-free ASEAN imports | The paper cites associations with cardiovascular-disease risk, impaired memory and executive function, gut-microbiome disruption and glucose intolerance. | Transparency in labeling is needed because of cited risks to brain and gut health and the possibility of consumer resistance |
| Acesulfame potassium | Blended into diet sodas and energy drinks | Adds to displacement volume but is difficult to track because it is commonly blended with other sweeteners | The paper cites French studies linking it to cancer and cardiovascular-disease risks and reduced insulin sensitivity. It is also included on the World Health Organization’s nonsugar sweetener list. | Blends should be disclosed through mandatory labeling |
| Stevia and steviol glycosides | “Natural” zero-calorie drinks and monk-fruit blends | Marketed as safer substitutes but still displace cane sugar | The paper says they are included on the WHO’s nonsugar sweetener list. It cites no hepatotoxicity or tumors and notes increased insulin sensitivity, although effects on gut microbiota remain uncertain. | May serve as a transitional option because of a safer cited profile, although the WHO advises reducing overall sweetness |
| Erythritol | Keto drinks, monk-fruit blends and bulking agents for stevia | A major contributor to displacement that may be undisclosed in “sugar-free” products | The paper cites a 2024 Nature Medicine report associating it with a twofold higher risk of heart attack and stroke and a mechanism involving platelet clotting. | Front-of-package cardiovascular-risk warnings are urgently needed |
Combined impact
Taken together, the six stressors show that the Philippine sugar industry is not facing isolated challenges but a convergence of governance failures, climate shocks, rising input costs, biological invasions, labor pressures and market displacement.
Overimportation and alternative sweeteners exert nationwide pressure. El Niño is expected to affect Luzon disproportionately, while RSSI has caused extensive damage in Negros Occidental. Fertilizer, logistics and labor costs are reducing margins across all regions.
The findings show that mismanaged imports can devastate livelihoods and that regional differences must be considered to avoid excessive responses to projected supply deficits.
Pest outbreaks can intensify the effects of climate stress. The paper says a large-scale release of parasitoids could help control infestations that reduce cane and sucrose yields, demonstrating the need for integrated pest and climate governance.
Input costs continue to reduce margins, requiring stabilization mechanisms. Wage increases must be balanced with labor rights and farm viability.
Alternative sweeteners are not a marginal concern but a systemic stressor comparable in scale to the overimportation of refined sugar. The paper estimates that they displace ₱20 billion to ₱30 billion in farmer revenue while contributing to health risks involving cancer, cardiovascular disease, diabetes and neurological effects.
The products enter duty-free under ASEAN rules even as they contribute to economic and health vulnerabilities, according to the paper.
It recommends integrating trade, health and agricultural policy through tariffs, labeling requirements and the promotion of food-based alternatives such as mung beans, string beans, sweet potatoes, coconut sugar and fruit.
Policy priorities
The paper recommends the following actions:
1. Climate-sensitive trade
Prevent overimportation by aligning import volumes with production forecasts based on El Niño-Southern Oscillation conditions.
Strengthen Sugar Regulatory Administration clearance protocols for refined sugar and products classified as “other sugars.”
2. Buffer stocks and input costs
Establish national buffer-stock systems to stabilize supply during El Niño and typhoon-related shocks.
Implement fertilizer and logistics cost-stabilization mechanisms to protect farmers from oil-driven price increases.
3. Labor and mechanization
Balance wage increases with farm viability by supporting mechanization and cooperative-based labor pooling.
Provide subsidies or credit lines to help smallholders adopt mechanized harvesting.
4. Pest management
Fund programs for the mass rearing and release of endemic parasitoids to control RSSI infestations sustainably.
Strengthen biosecurity measures to prevent future outbreaks of invasive pests.
5. Sweetener regulation
Require tariffs, quotas and mandatory labeling for nonsugar sweeteners.
Introduce front-of-package warnings for sweeteners identified as high-risk in the paper, including erythritol and aspartame.
Promote food-based alternatives such as mung beans, string beans, sweet potatoes, coconut sugar and fruit to reduce dependence on nonsugar sweeteners.
6. Cooperatives and mill upgrades
Support cooperative financing for collective input procurement and mill upgrades.
Provide incentives for modernization to improve the industry’s competitiveness against imports and substitute products.
Conclusion
The resilience of the Philippine sugar industry depends on transparent trade governance, climate-adaptive strategies, input-cost stabilization, labor protection, integrated pest management and regulation of alternative sweeteners.
Observed data show that overimportation caused an estimated ₱19.78 billion in direct and indirect losses.
El Niño is projected to cause ₱7.1 billion to ₱11 billion in direct and indirect losses, while the RSSI infestation threatens up to ₱15.6 billion in sugar production.
Higher fertilizer and logistics costs imposed an estimated ₱3.5 billion to ₱5 billion in additional expenses, while labor costs added an estimated ₱2 billion to ₱3 billion.
Alternative sweeteners displaced an estimated ₱20 billion to ₱30 billion in farmer revenue.
Although the figures distinguish among observed, estimated and projected effects, the convergence of the six stressors shows that governance failures — particularly mismanaged imports and unchecked substitution by alternative sweeteners — remain the most financially damaging.
Integrated strategies combining economic safeguards with climate and pest resilience could stabilize rural economies and support the long-term sustainability of the sugar industry without overstating the possibility of collapse. /dm
[Teodoro C. Mendoza, Ph.D., is a retired professor and UP scientist at the Institute of Crop Sciences, College of Agriculture and Food Science, University of the Philippines Los Baños.]
