Lowering sugar prices still within gov't power: House leader

• Published date: 04 November 2022
• Publication title: Philippines News agency

The chair of the House committee on ways and means on Friday said it is still within the government's power to lower the prices of sugar despite most price increases being beyond its control due to global conditions.

Albay Representative Joey Salceda made the statement in response to the October 2022 inflation report which shows the country's general price levels to be the highest in nearly 14 years with the inflation rate increasing to 7.7 percent in October.

'High corn, fuel, and electricity prices are primarily a matter of global conditions. But for sugar, because of our longstanding policy of misguided protectionism, we have it coming,' Salceda said.

He warned that having high prices of sugar would 'kill domestic jobs more than they help farmers", noting that some 66 percent of all sugar demand is as input to other Philippine industries, while only 34 percent is consumed in final form.

"The problem with high sugar prices isn't just that consumers are bearing the brunt of it. It's that Philippine industries consume more sugar than consumers do. And they're in trouble if we don't sort the situation out," he said.

He said the country's structural sugar issues is already costing jobs because they are inputs to other sectors and are affecting the prices of bread, soft drinks, alcoholic drinks, dairy products, and other processed foods.

He cited data from the 2018 240-sector input-output tables by the Philippine Statistics Authority showing that some 102.5 billion in sugar is consumed by other sectors as an intermediate input, while only 51.9 billion is used as a final good.

He also highlighted that out of all the goods in the October inflation report, sugar represents the highest year-on-year increase at 34 percent.

"That is a form of self-harm or self-sabotage when global prices have already stabilized at more or less their 50-year average of 17-18 cents per pound," he said.

He suggested that allowing industrial users to import sugar is the most immediate way to address some parts of food inflation.

'I've talked to farmer groups and they complain that their problem is input costs. High fertilizer and farm fuel costs are major issues. Among milling companies, energy costs are also the issue. I already have a proposal to allow industrial users to import another 400,000 MT (metric tons) of refined sugar," he said. "If we auction those slots off, we could be earning as much as 12 billion pesos, which we could provide...