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NEDA slammed over study on sugar industry reform

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The National Federation of Sugarcane Planters slammed the National Economic and Development Authority for its sugar industry reform study.

The “Study on Institutional Reform in the Philippine Sugar Industry”, that was conducted by Brain Trust: Knowledge and Options for Sustainable Development for NEDA, was presented recently in a virtual forum attended by representatives from the government and private sector.

In the forum, NFSP was represented by lawyer Iñaki Larrazabal Jr., vice president for Eastern Visayas and president of the Ormoc Sugarcane Planters Association, and lawyer Roy Bernar Fiel, OSPA vice president.

The 16-page executive summary of the study contained an analysis of the sugar industry, the institutional and governance framework and challenges facing the industry, an assessment of trade liberalization scenarios, synthesis, and recommendations.

Among the recommendations are to pursue the conversion of the industry to a cane purchase system, phase-out of sugar classification system and move toward a single unified quedan, and pursue a phased easing of sugar trade restrictions.

The study also calls for strengthening the Sugar Regulatory Administration by redefining its roles and functions in line with the Sugarcane Industry Development Act, strengthen the industry’s institutional support mechanisms and update the industry roadmap to include sugar users and the development of a mill modernization and investment program.

But for NFSP president Enrique Rojas, the proposed mandatory cane purchase system will infringe on existing contracts of several stakeholders in the industry and will also impinge on valued traditional relational arrangements between planters and millers.

The NFSP proposes that the cane purchase system be presented as a voluntary option for interested parties, he said in a statement yesterday.

“The SRA can issue the relevant guidelines for cane purchase arrangements, which should include the imposition of a tripartite price management mechanism involving planters, millers, and government,” he added.

On the proposed single unified quedan, Rojas said the country needs to maintain its export commitments, especially with the United States, which serves as a solid buffer against fluctuations in the world and domestic sugar markets.

NFSP reiterated the need for SRA to continue exercising its power to regulate prices for the benefit of both producers and consumers. Otherwise, traders, who can impose logistical controls on supply, may possibly dictate sugar prices, he said in the statement.

He added that NFSP opposes the proposed phasing out of sugar trade restrictions.

“Unless and until the government can give subsidies equivalent or commensurate to the subsidies given in other sugar-producing countries, any attempt to lift quantitative restrictions and tariff barriers will only spell the death of the Philippine sugar industry,” the NFSP stressed.

They agree that there is a need to have a holistic perspective in approaching development challenges in the sugar industry, but focusing the study on the quedan, miller-planter relationship, and importation to disrupt supply principally takes the side and perspective of the consumer, the statement said.

They said they agree with the findings of the study that trade liberalization of sugar is not yet proper at this time.

“NFSP will continue to fight for the welfare of the sugar farmers and for the well-being of the entire sugar industry,” Rojas said.*


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June 2024

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