PHILIPPINES: Sugar smuggling picks up as prices drop
Published: 03/18/2010, 8:23:16 AM
Sugar smuggling has once again reared its ugly head in the country amid the softening of world sugar prices, said a stakeholder in Negros Occidental, according to the Philippines' Sun-Star newspaper.
"Jose Mari Miranda, one of NFSP's officers and president of the Cebu-based Bogo-Medellin Planters Association, informed me that smuggled refined sugar has been entering the country lately," said Enrique D. Rojas, president of the National Federation of Sugarcane Planters (NFSP) Inc.
He said the smuggled sugar has found its way into the Cebu market and is now being distributed in a store in Tabuan, Talisay and in other places in Cebu.
"According to reports the brains behind the sugar smuggling is a politician from Mindanao," he added.
Rojas said that he had already informed Manolet Lamata, head of the sugar industry's Anti-Smuggling Task Force, about the report on the presence of smuggled sugar in Cebu. He exhorted Lamata to monitor the other markets and determine if smuggled sugar has already penetrated other areas in the country so that necessary legal action can be taken immediately against the perpetrators.
"The sugar industry's Anti-Smuggling Task Force has compiled a data base of suspected sugar smugglers, their warehouses and their distribution points. These people and their illegal operations will be closely scrutinized in view of these reports so that they can be prevented from inflicting further damage to the sugar industry, like what they used to do in the past," Rojas stressed.
Sugar smuggling has been a bane to the sugar industry in the past years, particularly when sugar prices in the world market were way below domestic prices, said Rojas adding that last year, world prices reached a three-decade high, consequently making it unprofitable to smuggle sugar into the country.
Due to high world prices, which prevented the entry of smuggled sugar into the country, it is only this year that the country's real sugar consumption has been truly revealed because all the country's domestic needs have been sourced from domestic production, he said.
With the present decline in world sugar prices, sugar smuggling has again become profitable, said Rojas.
The cheaper smuggled sugar causes domestic sugar prices to collapse to the detriment not only of producers but also of the traders, Rojas said.
"The producers are the ones who will suffer most from the decline in domestic sugar prices due to the presence of smuggled refined sugar in the market. However, not only the producers but also the traders are affected. Mari Miranda informed me that traders are also complaining that they cannot dispose of their sugar stocks which they bought at high prices because cheaper smuggled sugar is displacing the demand for domestic sugar in the market," Rojas said.
"I call on the President and the Bureau of Customs, as well as the Department of Trade and Industry and the Sugar Regulatory Administration, to immediately act on this matter because this poses a very serious threat to the already endangered sugar industry," Rojas said.