How bright is
Negros' sugar future?

The agriculture attaché of the United States to the Philippines - Jude Akhidenor - Tuesday predicted better prices for Negros Occidental's sugar. That is for the next two years, the time it will take for the United States to recover from the damage devastation by the three hurricanes that hit the US sugar belt last year. It is also a fact that the US increased the share of the Philippines in its sugar quota by an additional 30,000 metric tons, the third actually since the Katrina visit.

That makes the Philippines the third biggest exporter of sugar to the US, Akhidenor observed. His visit there is part of the assessment on the capability of the local sugar industry to maintain the same level of export of sugar to the US.

That's the good news. But there are new developments that could undercut the future of the Philippine sugar industry insofar as its trade relations with the US is concerned.

The latest report by the Associated Press states that a looming free trade provision that allows Mexico to export unlimited amounts of sugar to the US could force changes to the US sugar program.

AP's dispatch reported that a flood of Mexican sugar imports could cause domestic prices to plunge. In turn, this could lead to taxpayer-funded government purchases of surplus sugar, "unless changes are made to the sugar program."

Mexico could limit is sugar exports if it gets the US to "voluntarily limits corn syrup," according to Gary Haufbauer, a senior fellow of the Institute for International Economics.

The implications of this new development prompted Randy Green, president of the Sweeteners Users Association, to predict that Congress will make changes in the sugar program.

Thus, the American Sugar Alliance is already girding up for a fight on the US farm bill.

In short, it is bound to be a bruising fight as evidenced already by the distribution of information packets to every Capitol Hill office on sugar policy.

Some Minnesota lawmakers are already looking for an alternative market for sugar ethanol. Republic Senator Norm Coleman reportedly said that he will push the sugar-to-ethanol program. At any rate, for the moment the domestic price of sugar has risen to be on par with the world sugar prices. So that may not necessarily be a worrisome development insofar as Negrense sugar producers are concerned.

But I think it is time for the Sugar Alliance to map out plans on what to do just in case the US Farm Bill is drastically altered and we could find ourselves deprived of the premium US market for our sugar.

Of course, the current trend shows that world sugar prices may continue to climb higher. In which case, we can simply go into export ourselves at a profitable price level.

Besides, the trend is toward hiked ethanol production with no less than Brazil trying to encourage the European Union to manufacture ethanol as alternative fuel.

In the US, Washington has already mandated a measure which the Governor is expected to sign into law requiring that two percent of all gasoline in the state should contain ethanol. It also stipulates that two percent of all diesel in the state contain biodiesel. This law is effective December, this year. More important, the report that Hawaii is going to start enforcing its 1994 law requiring the 10 percent blend of ethanol with gasoline starting April, this year.

It is expected to boost Hawaii's sugar industry. It is expected that the demand will reach about $40 million of ethanol a year.

Hawaii is reportedly poised to put up six ethanol production facilities. An ethanol plant will be constructed in Oahu in three to four months.

But in the Philippines, its is only now that the Department of Science and Technology and the Department of Energy are poised to activate a testing center at the University of the Philippines mechanical engineering department to conduct vehicular performance, fuel cost and emission reduction testing for alternative fuels.

That's funny. In Brazil, it was reported that flex fuel cars sales rose to 93,000 units in February, an increase from the 91,526 units reported in January.

In short, flex fuel cars, which run in any mixture of gasoline and ethanol, now account for 76.6 percent of all light vehicle sales in Brazil. This up from the 72.8 percent in January.

And here we are just starting to test the 10 percent ethanol mix. All we have to do is simply ask for details from car manufacturers on whether our current models of cars can absorb the 10 percent mix.

As pointed out by an Italian - tarde piace. Very slow moving. Or too late, the Phalarope.*

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