Business
PCCI alarmed by sudden surge in sugar prices
By
Mar 12, 2010 - 9:28:58 AM

MANILA, March 13 (PNA) -- The Philippine Chamber of Commerce and Industry (PCCI), the largest business organization in the country, is alarmed over the surge in sugar prices.

The PCCI said the government should intervene before the food export industry "caves in."

PCCI vice president Roberto Amores said that the inadequate market supply of sugar might be due to the removal of the "D" Quedan sugar allocation, which caused uncertainty among food processors and consumers and might result in hoarding of the product.

Last Nov. 3, the Sugar Regulatory Administration (SRA) terminated the class D Quedan sugar allocation to the export food processors, and transferring of the equivalent volume to class C-1.

The SRA also issued on Nov. 8, 2009 Sugar Order No. 4 series of 2009-2010, converting C-1 sugar produced as of crop year 2009-2010 to B sugar. The Quedan D sugar is competitively priced as it follows the world market price.

On March 10, 2010, PCCI wrote SRA to consider immediately restoring the D Quedan allocation for export food processors.

Francis Chua, PCCI president, said that access to the competitively priced D sugar was critical to food processors as sugar imports were levied a duty of 38 percent and without the D sugar, food exporters would be immensely disadvantaged, as sugar accounts for 30 to 40 percent of their production cost.

“The rise in sugar prices puts sugar-based food manufacturers in a losing end against more competitive ASEAN neighbors such as Thailand, Malaysia and Vietnam,” Chua said.

Chua also expressed fears that if the high cost of sugar persist, many of the local food manufacturers, most of whom are still suffering from the effects of the lingering global economic crisis, might be forced to close shop or resort to mass lay-off of workers.

He said that even the consuming public was already hurting from the worsening situation.(PNA)
RMA/bac/utb