Sugar producers are losing income due to the rising costs of fertilizers and petroleum, former Sugar Regulatory Authority (SRA) board member Dino Yulo said on Friday, January 28.
The steep climb in sugar industry production costs, he said, will impact greatly on Negros Occidental, which remains largely a monocrop economy.
Yulo, in a press statement, said the price of urea, the fertilizer grade farmers use, jumped by 255% in a year and a half. A 50-kilo (LKg) bag that sold for P900 18 months ago now goes for P2,300-2,400 per bag, he pointed out.
Producers also face high petroleum costs. “The petroleum price hike has almost doubled as well, with diesel fuel breaching the P50 per liter mark,” Yulo said.
Negros Occidental’s sugarcane farms represent 53% of the 423,333 hectares utilized by the industry nationwide.
The province accounts for more than half of the P90 billion the sugar industry contributes annually to the national economy.
Yulo warned that price hikes in two major farm inputs will have a “severe impact” on the sugar industry.
Higher production costs already reflect in local sugar prices.
The SRA demand and supply table shows the January 16 millsite price of raw sugar at P1,924.62 per LKg compared to P1,488.82 on the same day in 2021.
The wholesale price of raw sugar per LKg is P1,950 compared to P1,700 in 2021, a 14.71% increase.
Washed sugar now sells for P2,100/LKg from P1,800 in 2021, or a 16.67% increase.
Refined sugar has an even higher price jump, at 25.58%, from P2,150/LKg in 2001 to P2,700 this year. Its retail price per kilo increased from P50 in January 2021 to P54.50 in January 2022.
Sugar industry leaders called out for national intervention several months ago but, “so far, there has been no concrete action from the Department of Agriculture and the Department of Trade and Industry,” Yulo said.
“Since September, there have been calls for fertilizer subsidies and setting a price cap on this particular commodity, yet our appeal has not been acted upon,” he added.
The call is now very urgent, Yulo stressed, because the harvest season has already peaked and planting season has started in several areas.
Unless the prices of the two key farm inputs drop, such factors would further burden a province still struggling to recover from the effects of Typhoon Odette.
Yulo noted that Odette, which slammed into southern Negros on December 16, 2021, damaged or destroyed many farm structures, including the homes of field workers. It also led to the temporary stoppage of a sugar mill.
“Our planters in the south may not be able to survive this crisis if DTI does not step in and ensure that fertilizer costs are kept at bay,” Yulo said.
The SRA’s 2020 roadmap notes that 26,188 farmer-owners cultivate 212,627 hectares of sugarcane plantations in the province.
Governor Eugenio Jose “Bong” Lacson said 85% of sugarcane farmers are agrarian reform beneficiaries. Many depend on planters’ federations for better milling contracts, and negotiating farm inputs and trading. – Rappler.com