THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT POLICY Required Report - public distribution Date: GAIN Report Number: 10/30/2012 Philippines Sugar Semi-annual 2012/13 Situation and Outlook Approved By: William Verzani Prepared By: Pia Ang Report Highlights: Philippine sugar production declined by seven percent to 2.24 million metric tons (MMT) in Crop Year (CY) 2011/12 (September to August) due to the prolonged rainy season. The Philippine Sugar Regulatory Administration (SRA) projects production for CY 2012/13 to recover by 5 percent to 2.36 MMT, barring any serious weather disturbances. Due to significantly lower beginning stocks, Post forecasts total exports for CY 2012/13 at 295,000 MT, down from when ample beginning stocks and strong demand resulted in unusually strong exports of 545,000 MT. CY 2012/13 exports to the United States under the tariff rate quota program are set at 144,901 MT but are likely to increase if the USG grants additional sugar allocations to quota holders in early 2013.
Commodities: Sugar Cane for Centrifugal Sugar, Centrifugal Production: According to the SRA, Philippine raw sugar production reached 2.24 MMT in, seven percent lower than the previous forecast of 2.40 MMT. The decrease in production was attributed to wet conditions as a result of the prolonged rainy season. Cane production reached 23.88 MMT over the same period. Raw sugar production in CY 2012/13 is estimated to recover by five percent to 2.36 MMT with area planted remaining the same as the previous year at about 422,000 hectares. From a high of about P1,800/50-kg bag of raw sugar in August 2012, wholesale prices have since come down to about P1,450-1,500/50-kg bag (as of October 2012). According to industry, the early start of the milling season this crop year has temporarily increased the supply of sugar in the local market and has put some downward pressure on prices. In, the average mill site price of A raw sugar for the U.S. market was P1,234 /50-kg bag, down 11 percent from P1,388/50-kg bag the previous year. National average mill site price for B raw sugar for the domestic market was P1,419/50-kg bag, down 26 percent from P1,900/50-kg bag the previous year. The average composite price was P1,346/bag, down 30 percent from the previous year s price of P1,864/bag. Wholesale and retail prices of raw and refined sugar in Metro Manila for CY 2011/12 follow: DOMESTIC RAW AND REFINED SUGAR PRICES Raw Sugar Refined Sugar Wholesale Price Retail Price Wholesale Price (Pesos/per (Pesos/ (Pesos/per 50 Kg. Bag) per 1 Kg. Bag) 50 Kg. Bag) Retail Price (Pesos/ per 1 Kg. Bag) September 1,457.72 40.45 1,919.02 47.10 October 1,435.68 40.34 1,864.51 46.76 November 1,393.33 38.95 1,772.96 45.41 December 1,397.61 38.35 1,814.29 44.51 January 1,390.57 37.76 1,838.16 43.92 February 1,422.35 36.72 1,851.85 43.31 March 1,518.94 36.50 1,981.01 43.73 April 1,621.96 37.37 2,060.94 45.04 May 1,621.96 38.99 2,062.77 46.34 June 1,785.24 39.84 2,258.54 47.44 July 1,787.57 42.86 2,286.51 50.82
August 1,798.33 43.25 2,273.33 50.88 U.S. Dollar to Philippine Peso Exchange Rates from 2008 to September 2012 follow: Exchange Rate 2008 2009 2010 2011 September 2012 US$=PhP 44.47 47.64 45.11 43.31 41.75 Source: Bangko Sentral ng Pilipinas Consumption: Domestic sugar consumption is measured by monitoring withdrawals from the mills. Withdrawals in were up slightly to 2.03 MMT as demand by industrial users strengthened due to the lower domestic prices. Consumption is expected to increase slightly further in CY 2012/13 due to the upcoming national elections in mid-2013 (traditionally in the Philippines, there is a perceptible uptick in demand for food items that occurs in-line with national campaigns and elections). Monthly raw sugar withdrawals for follow: RAW SUGAR (DOMESTIC) WITHDRAWALS MONTH METRIC TONS (MT) September 61,458 October 111,533 November 125,636 December 159,643 January 217,870 February 214,197 March 204,341 April 243,650 May 159,065 June 190,185 July 172,863 August 169,425 TOTAL 2,029,866 Monthly molasses prices for follow: MOLASSES PRICES
Average Price MONTH (Pesos/MT) September 2,600 October 2,746 November 3,013 December 3,471 January 3,545 February 4,250 March 4,558 April 4,835 May 5,122 June 5,861 July 6,322 August 6,255 Trade: Due to significantly lower beginning stocks, Post forecasts total raw sugar exports for CY 2012/13 at 295,000 MT, down from when ample beginning stocks and strong demand resulted in unusually strong exports of 545,000 MT. CY 2012/13 exports to the United States under the tariff rate quota program are set at 144,901 MT Raw Value (138,827 MT Commercial Weight) but are likely to increase if the USG grants additional sugar allocations to quota holders in early 2013. No imports are expected for CY 2012/13 due to projected adequate sugar production for the current crop year.
Production, Supply and Demand Data Statistics: Sugar, Centrifugal Philippines 2010/2011 2011/2012 2012/2013 Market Year Begin: Sep 2010 Market Year Begin: Sep 2011 Market Year Begin: Sep 2012 USDA Official New Post USDA Official New Post USDA Official New Post Beginning Stocks 394 394 592 592 387 287 Beet Sugar Production 0 0 0 0 0 0 Cane Sugar Production 2,400 2,400 2,240 2,240 2,400 2,400 Total Sugar Production 2,400 2,400 2,240 2,240 2,400 2,400 Raw Imports 0 0 0 0 0 0 Refined Imp.(Raw Val) 0 0 0 0 0 0 Total Imports 0 0 0 0 0 0 Total Supply 2,794 2,794 2,832 2,832 2,787 2,687 Raw Exports 202 202 395 539 250 250 Refined Exp.(Raw Val) 0 0 50 6 50 50 Total Exports 202 202 445 545 300 300 Human Dom. Consumption 2,000 2,000 2,000 2,000 2,000 2,000 Other Disappearance 0 0 0 0 0 0 Total Use 2,000 2,000 2,000 2,000 2,000 2,000 Ending Stocks 592 592 387 287 487 387 Total Distribution 2,794 2,794 2,832 2,832 2,787 2,687 1000 MT Sugar Cane for Centrifugal Philippines 2010/2011 2011/2012 2012/2013 Market Year Begin: Sep 2010 Market Year Begin: Sep 2011 Market Year Begin: Sep 2012 USDA Official New Post USDA Official New Post USDA Official New Post Area Planted 395 395 420 420 420 420 Area Harvested 390 390 415 415 415 415 Production 25,900 25,900 24,300 24,300 26,000 26,000 Total Supply 25,900 25,900 24,300 24,300 26,000 26,000 Utilization for Sugar 25,900 25,900 24,300 24,300 26,000 26,000 Utilizatn for Alcohol 0 0 0 0 0 0 Total Utilization 25,900 25,900 24,300 24,300 26,000 26,000 1000 HA, 1000 MT