Sugar 101
An Introduction to the Philippine Sugar Industry
Sugar 101
An Introduction to the Philippine Sugar Industry
A. Sugar Types and Major By-Products
B. Industry Framework and Stakeholders
C.Sugar Mills, Production Data, and the Crop Season
D.Commercial Terms and Delivery Methods
A. Sugar Types and Major By-Products (Physical)
Details
Raw
Washed
Standard Refined
Premium Refined
Molasses
Bagasse
Classified under Raw Sugar
Better quality vs. Standard
Refined
Viscous liquid by-product of Raw and
Refined Sugar production
Also known as “Bottler’s
Grade Sugar”
Gives brown sugar its color, taste, and
nutrient content
Industrial use (beverages),
Consumers
Industrial use (beverages,
pharma), Consumers
Alcohol production, Feed mills, Bioethanol, Reprocessed for human
consumption
Biofuel for raw sugar mills
and refineries
(Approx.)
Raw + P500
(Approx.)
ST Refined + P150-P200
Weekly Tenders
Variable
Better quality vs. Raw
Description
Brown Sugar
White Sugar
Also known as “Premium
Raw Sugar”, “Special Raw
Sugar”, etc.
Uses
Industrial use, Consumers
Industrial use (biscuits and
crackers), Consumers
By-product of sugar cane
crushing
Weekly Tenders
Pricing
Polarization
Color
Granule Size
Moisture
Weekly Tenders
(Approx.)
Raw + P50-P250
B. Industry Framework and Stakeholders
B. Industry Framework and Stakeholders
Sugar Regulatory Administration (SRA)
- Under the Department of Agriculture (DA)
- Governing body of the PH Sugar Industry
- Gives mandates under “Sugar Orders” (SO), which indicates
importation and/or export programs (if any), along with Quedan
allocations
B. Industry Framework and Stakeholders
Quedan System
Quedan Certificate
- Warehouse receipts that indicate ownership of
Raw Sugar in a particular sugar mill
- Must be “surrendered” with corresponding fees
paid to be converted to ”physical” sugar (ready for
withdrawal)
- May have different classifications for market
segmentation
B. Industry Framework and Stakeholders
Quedan System
Example:
The SRA mandated the following Quedan Allocation:
A: 5%
B: 85%
D: 10%
In its 2nd week of milling, Sugar Mill X produced 20,000 Lkg
of Raw Sugar. This will be broken down as follows:
A: 1,000 Lkg
B: 17,000 Lkg
D: 2,000 Lkg
B. Industry Framework and Stakeholders
Quedan System
Quedan
Types
A
US Quota Export
B
Domestic Market
D
World Market Export
Incoterms: FOB
Pricing: Sugar No. 16 + Logistics
Volume: Approx. 137 MT
Incoterms: FOB
Pricing: Sugar No. 11 + Logistics
Volume: Depending on Allocation
B. Industry Framework and Stakeholders
Supply
Output Sharing
70-30
69-31
68-31
Weekly Tenders
Wednesday/Thursday
Quedan Bidding
B. Industry Framework and Stakeholders
Middle Market
International Sugar Traders
- Participate in import/export programs, along with the domestic market
- Participate in weekly tenders/biddings
- All Asian, SUCDEN, Comtrade, Delmax, Oro Allado, etc.
Domestic Sugar Traders
- Exclusively engage in the domestic market
- Registered traders participate in weekly tenders/biddings
C. Sugar Mills, Production Data, and the Crop Season
C. Sugar Mills, Production Data, and the Crop Season
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C. Sugar Mills, Production Data, and the Crop Season
C. Sugar Mills, Production Data, and the Crop Season
D. Commercial Terms and Delivery Methods
Ex-Mill or Ex-Warehouse
- Ex-works
- To be picked up via nominated trucker
Ex-Pier
- CIF
- Shipped via container vans
- To be picked up via nominated trucker (van-out or stuffing)
Delivered
- DDP
- Deliveries to location of buyer’s choice