BIZ BUZZ: Sugarcoating a crisis

A picture of a tarpaulin sign at a soft drinks factory says it all: the plant suspended operations due to lack of bottler’s grade sugar. And it’s not just a single plant.

Industry sources told Biz Buzz there are over a dozen bottling facilities in Luzon, Visayas and Mindanao that have either shut down or about to temporarily cease operations. This is the first time in recent memory that beverage firms have had to close shop, albeit temporarily, for lack of their primary ingredient.

Rising sugar prices are also indicative of tight supply. Data from the Department of Agriculture (DA) show that a kilo of refined sugar only worth P54.50 in January jumped to P99 a kilo in just a few months.

The shortage is so acute it’s affecting not just industrial users but even small and medium enterprises like candy factories, bakeries and the like. Also feeling the pinch are ordinary folk who have to pay more at the retail level. Left unresolved, industry analysts predict that the supply shortage will worsen before it gets any better.

According to sugar industry sources, it takes at least two months to bring white sugar from Negros to Luzon from the day the cane is milled. The physical process of refining from raw, submitting to quedans, paying taxes, documentation, trucking and shipping is more than a two-month process to reach Batangas or Manila. Thus, industry experts say, consumption needs to be planned in advance. One cannot wait to buy sugar only when his or her warehouse is empty. In other countries, government has a policy of automatically importing commodities when the buffer stock drops to a certain threshold.

The current crisis again brought to fore the need for careful planning and accurate supply forecasts. Year after year, industry and government estimate total sugar demand at roughly 2.4 million metric tons. With local production of only 1.8 million MT, it’s obvious that there’s a huge deficit of between 500,000 to 600,000 MT being filled by a combination of imports and smuggled sugar.

While recent raids by DA and customs officials of warehouses yielded what some called “a sea of sugar,” no amount of sugarcoating can hide the shortage.

At this point, it seems importation is the only option to stave off a full-blown crisis. While industrial users want to import the scarce commodity themselves, smaller firms have serious concerns that it will put them at great disadvantage since they don’t have the capacity to import directly from the best and cheapest sources.

Some argue then that the Solomonic solution is for government to finally acknowledge the crisis, and give import licenses to refiners and responsible, tax-paying traders. After all, traders not only help farmers and give credit terms to industrials, they also sell to small, medium and large customers at the price and time they need sugar.

At the end of the day, it’s the government who will make the difficult decisions. It must do so quickly before it’s too late. But will it? Abangan!

—Daxim L. Lucas

Speaking of which …

With the local agriculture sector in dire need of greater attention and resources from the Executive branch, perhaps it’s time for President Marcos to appoint a permanent Secretary of Agriculture.

One name that industry insiders believe should be considered is current Bangko Sentral ng Pilipinas Monetary Board member Bruce Tolentino.He is best known for his role as the Deputy Director General of the International Rice Research Institute, and is schooled as an economist.

He also served as Assistant Secretary of Agriculture, then Undersecretary in the 1980s, so the portfolio is not foreign to him.

In any case, whether it’s him or another name, a permanent appointment is needed. And soon.

—Daxim L. Lucas

Selling what isn’t yours?

How can such a sale happen? How can a building developer sell units it did not own? No way, right? But the Human Settlements Adjudication (HSAC) Board adjudicator thought otherwise and upheld the “sale.”

We’re talking about the Aurora Milestone Tower along Aurora Boulevard in Cubao, Quezon City, whose developer was hit by the 1997 East Asian financial crisis. The developer, JOS, lost the property to its creditor bank through foreclosure. The bank won the subsequent public auction and was issued a certificate of sale by the local government on April 27, 1999.

A company named Hyperdulia Consultancy then bought the 16-storey largely vacant building from the bank in 2018 and the few lessees or occupants of the building then had to leave on court order so the building could be fully renovated and made like new again.

But one party, PAVPI, which is under court liquidation and had vacated the premises peaceably earlier, later on claimed it owned the units it occupied through its receiver. PAVPI is owned mainly by the “J” in JOS, which stands for Jorge, Olaguer and Sarda.

The receiver submitted to HSAC a copy of a supposed deed of sale dated December 27, 1999, or eight months after the creditor bank was officially made the building’s owner. In his liquidation report to the court, however, the receiver admitted that there was no absolute deed of sale for the units, only contracts to sell, which don’t cut it as far as a done deal goes. Also, no proof was submitted that the taxes for the sale had been paid. Still, HSAC adjudicator agreed with the receiver.

So Hyperdulia is asking HSAC to take a second look at the case. Meanwhile, Hyperdulia is preparing legal criminal action to be filed in the next few days. Hyperdulia’s major stockholder, a former newspaper editor and now a PR practitioner, is going all out.

—Daxim L. Lucas

Best (wo)man for the job

The best man for the job is a woman, once again.

We’re talking about Aboitiz Equity Ventures’ chief information security officer and former US Army officer, Charmaine Rose Valmonte.

Valmonte was recently recognized by the Top Women in Security initiative of the global Women in Security and Resilience Alliance. The group “promotes women in the security technology industry.”

She was specially honored for her role in security training and education.

Those skills are critical as corporations—and crooks—become more digital-savvy. It is especially important for the Aboitiz Group as it seeks to build the country’s first “techglomerate.”

Valmonte, who managed and implemented security and cybersecurity operations as a US Army officer, described her job as building cyber warriors within Aboitiz.

She helped develop the IT risk management and resiliency division of Aboitiz-led Union Bank of the Philippines.

“This special award confirms what I set out to do back in 2011 when I retired from the military [which was] to build and develop our future leaders here in the Philippines. We don’t need to rely on foreign talent; we have it here, we just need to build the capabilities,” she said.

—Miguel R. Camus

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