Christy Balita
Research expert covering the Philippines
Sugar market in the Philippines - statistics & facts
Struggling to find bottler’s grade refined sugar, Coca-Cola Beverages Philippines announced in August 2022 they were cutting soda production. Several bakeries were forced to increase prices as refined sugar retail prices skyrocketed, reaching a high of 105.7 Philippine pesos per kilo in April 2023. Small eateries and consumers also faced the brunt of the imminent sugar crisis, particularly due to an elevated average inflation rate across commodities. Despite a slim raw sugar production growth in crop year (CY) 2022/23, the Philippines is poised to resume sugar imports to facilitate supply.
Western Visayas continued to be the biggest raw sugar-producing region in the Philippines, producing about 13 million metric tons of sugar in 2023. However, as typhoons and El Niño persist, the nation’s raw sugar output has shown only gradual growth, reaching 1.8 million metric tons during CY 2022/23. Meanwhile, refined sugar production has slowed since CY 2017/18, reaching its lowest volume in CY 2022/23.
Supply disruptions for raw and refined sugar in the country led to recent price increases. Between December 2022 and January 2023, raw sugar prices almost doubled, retailing at 86.1 Philippine pesos per kilogram as of March 2024. Meanwhile, despite the corresponding increase in the wholesale price of refined sugar between December 2022 and January 2023, it steadily declined in the first quarter of 2024. Nevertheless, this was not yet reflected in its retail price, which stood at 94.51 Philippine pesos per kilogram in March 2024, about 70 percent more than in 2022.
The Sugar Regulatory Administration (SRA), on the other hand, intends to resume supplying raw sugar to its sole trading partner, the United States. The SRA plans to supply 25,000 metric tons towards the end of 2024, following a four-year hiatus. Although exports should only be resumed when there is overproduction, the SRA stated that their exporters have asked permission since the buying price for raw sugar is high. The agency is also concerned about losing the US quota if it is not utilized for a prolonged period. The export of raw sugar contradicts plans to import refined sugar, whose supply is already substantial.
Sugar production woes
Sugar in the Philippines is mainly produced from harvested sugarcane, the nation’s main agricultural crop in 2022. From the 401,000 hectares of land used for sugarcane cultivation, plantations had an average yield of about 95 LKG (or 50-kilogram bag of sugar) per hectare during CY 2022/23. While raw sugar accounts for most of the sugarcane production, it is also used to make traditional wine, cane vinegar, and ethanol.Western Visayas continued to be the biggest raw sugar-producing region in the Philippines, producing about 13 million metric tons of sugar in 2023. However, as typhoons and El Niño persist, the nation’s raw sugar output has shown only gradual growth, reaching 1.8 million metric tons during CY 2022/23. Meanwhile, refined sugar production has slowed since CY 2017/18, reaching its lowest volume in CY 2022/23.
Supply disruptions for raw and refined sugar in the country led to recent price increases. Between December 2022 and January 2023, raw sugar prices almost doubled, retailing at 86.1 Philippine pesos per kilogram as of March 2024. Meanwhile, despite the corresponding increase in the wholesale price of refined sugar between December 2022 and January 2023, it steadily declined in the first quarter of 2024. Nevertheless, this was not yet reflected in its retail price, which stood at 94.51 Philippine pesos per kilogram in March 2024, about 70 percent more than in 2022.
Is importing sugar the answer?
To address supply disruptions, the government endorsed the resumption of refined sugar imports. In CY 2022/23, roughly 730,400 metric tons of refined sugar were imported, with another 200,000 metric tons expected to arrive in September 2024 to ensure stable supply and prevent retail price hikes. This plan could affect small sugarcane growers who are still struggling because of natural disasters and the high cost of fertilizer and petroleum products. Meanwhile, issues about hoarding imported sugar were discovered in 2022, with several thousand bags of sugar and repacking machines seized from multiple warehouses in Luzon.The Sugar Regulatory Administration (SRA), on the other hand, intends to resume supplying raw sugar to its sole trading partner, the United States. The SRA plans to supply 25,000 metric tons towards the end of 2024, following a four-year hiatus. Although exports should only be resumed when there is overproduction, the SRA stated that their exporters have asked permission since the buying price for raw sugar is high. The agency is also concerned about losing the US quota if it is not utilized for a prolonged period. The export of raw sugar contradicts plans to import refined sugar, whose supply is already substantial.
