DTI eyes 35% tariff on sugar imports
THE Department of Trade and Industry (DTI) is proposing a 35-percent tariff on sugar imports as the government plans to increase these to stabilize prices, its chief said on Thursday.
In a Viber message, Trade Secretary Ramon Lopez said the tariff would serve to protect sugar producers, and that revenues from it would go to the government, “instead of traders and millers.”
At present, sugar producers and traders need to secure approval from the Sugar Regulatory Administration (SRA) before they can import.
Imposing a tariff would allow more imports, which in turn would increase supply and stabilize prices, Lopez said, adding that they are looking to put a volume cap.
“As long as there is…a tariff, technically anyone can import. We should allow manufacturers and retailers (to import). What we need to study is [putting]a certain quota,” he said.
SRA data showed that sugar production for crop year 2017 to 2018 is expected to reach 2.38 million metric tons (MT). Domestic demand is estimated to be more or less 2.17 million MT.
The SRA noted that sugar cane tonnage and productivity have been weak since the start of the current crop year. Demand for both raw and refined sugar, however, grew, prompting the agency to approve the importation of 200,000 MT of the commodity earlier this year.
The wholesale price of raw sugar as of Tuesday averaged P2,076 per 50-kilogram bag. The figure is higher than the P1,564 per bag last September, the start of the crop year.
Average price of washed sugar increased to P2,205 per bag from P1,706 in September 2017; refined sugar, to P2,784 per bag from P2,016.
Retail price of raw sugar rose to P55.75 per kilo on Tuesday from P47.56 per kilo at the start of the crop year; washed sugar, P58.83 per kilo from P50.27 per kilo; refined sugar, to P66.14 per kilo from P54.92 per kilo.
“There is a gap of about 300,000 to 400,000 MT, that’s why there was a need to import. What I am after is allowing freer importation, because the current system only allows [a select]few to import. Plus, importers are paying fees to millers, which increase prices. Without these fees, prices would be cheaper,” Lopez explained.
The tariff for sugar is still subject to consultation, according to him.
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