Sugar Asia Conference Bangkok, Thailand May 16-17, 2012
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Transcript of Sugar Asia Conference Bangkok, Thailand May 16-17, 2012
Sugar Asia Conference
Bangkok, ThailandMay 16-17, 2012
Cane Farms Sugar MillBioethanol
The Philippine Sugarcane Industry
“Challenges & Opportunities”
Presenters:Jose Rojo G. AlislaRosemarie S. Gumera
Sugar Regulatory AdministrationDepartment of AgriculturePhilippines
Profile of the Philippine Sugarcane Industry
Crop Year 2011-2012
Area Planted 420,000 Hectares
No. Farmers 62,000
No. of Operating Sugar Mills-Total Milling Capacity
29185,000 Tons Cane / Day
No. of Operating Sugar Refineries-Total Refining Capacity
148,000 MT/Day
No. of Bioethanol Distilleries-Total Annual Rated Capacity
4133 million liters
VISAYAS(18 mills + 7 refineries
+ 3 distilleries)
MAP OF PHILIPPINE SUGAR MILLS & BIOETHANOL DISTILLERIES
LUZON
(7 mills + 4 refineries + 1 distillery)
NEGROS
MINDANAO(4 mills + 3 refineries)
TARLAC
Batangas Sugar
CAMARINES SUR
PAMPANGA
CAGAYAN
ILOILO
CAPIZ
LEYTE
CEBU
BUKIDNON
DAVAO DEL SUR
Davao
NORTH COTABATONE
GRO
S O
CCID
ENTA
L
NEGROS ORIENTAL
LopezSa
Tolong
AGUSANDEL NORTE
BOHOL
LANAO DEL NORTE
MASBATE
MISAMISOCCIDENTAL
MISAMISORIENTAL
SAMAR
SURIGAODEL NORTE
SURIGAODEL SUR
ZAMBOANGADEL NORTE
ZAMBOANGADEL SUR
SOUTHCOTABATO
PALAWAN
Legend
MANILA
Sugar millsMills with annexed refineryMajor sugar ports
SAN CARLOS
5,000 HECTARES
Green Future Innovations
CAGAYAN / ISABELA
11,000 HECTARES
Bioethanol production areasPampanga Bioenergy
7,000 HECTARES
PANAY
BATANGAS
Bioethanol target areas
Canlaon Alcogreen
5,000 HECTARES
Bioethanol Distilleries
CAVITE
Cavite Biofuels
7,000 HECTARES
N
S
EW
Distribution of Philippine Cane Areas, CY 2011-2012
Luzon
Mindanao
Panay
Eastern Visayas
Negros17,000 has.
Total Cane Area – 420,000 hectares
0 0.01 -
5.00
5.01 - 10.00
10.01 - 25.00
25.01 - 50.00
50.01 - 100.00
100.01 & above
-
20,000
40,000
60,000
80,000
100,000
No. of Farms
Cane Area, Hectares
No. of FarmsCane Area, Hectares
Profile of Philippine Cane Farms
75%
11 %
7 %4 %2 %1 %
Farm Sizes, Hectares
24% 12 %
15 %
15 %
16 %
18 %
Philippine Sugarcane Areas for the Past 10 Crop Years
350,000
360,000
370,000
380,000
390,000
400,000
410,000
420,000420,000
395,381
385,662 392,567
398,872
388,003
377,182
391,552 391,451
383,745
Area, Hectares
Crop Years
Philippine Cane & Sugar Production for the Past 10 Crop Years
Million MT
Crop Years
Philippine Farm Productivity for the Past 10 Crop Years
Philippine Sugar Production & Trade for the Past 10 Crop Years
Crop Year Pesos Per 50-kilo
bag
Peso-US $ Exchange
Rate
USCents/lb
2011-2012*
1,404 43.1529.58
2010-2011 1,864 43.4638.99
2009-2010 1,664 46.2132.74
2008-2009 945 47.9317.92
2007-2008 1,057 43.1022.29
2006-2007 844 48.1715.93
2005-2006 978 53.0116.77
2004-2005 664 55.5010.88
2003-2004 710 55.6811.59
2002-2003 843 53.4614.34
HISTORICAL PHILIPPINE RAW SUGAR COMPOSITE PRICES
* As of April 2012
Bioethanol Production, Liters
YearTOTAL
Production(Million Liters)
Mandated Bioethanol Blend
Mandated Volume
(Million Liters)
2008 0.368 Voluntary None
2009 23.11 5 % 208
2010 9.89 5 % 219
2011 4.14 10 % 461
2012* 12.00 (estimates as of
May 2012)
10 % 486
In 2012, around 486 million liters bioethanol is required under the 10% mandatedblend, however, only 4 distilleries are operational with a combined annual ratedcapacity of 133 million liters.
Power Situation in the Philippines2010 Power Generation by Plant Type, GWh
28,043
9,92921,678
7,803 288 GWh Coal
Geothermal
Oil-based
Hydroelectric
Wind / Biomass /SolarGross Power = 67,743 GWh
Total Electricity Sales in the Philippines, 2009 vs. 2010
0
10,000
20,000
30,000
40,000
50,000
60,000
17,5
04
14,7
56
17,0
84
1,52
3
50,8
67
18,8
33
16,2
61
18,5
76
1,59
6
55,2
66
2009
2010
GWh
2010 Installed and Dependable Capacity, Philippines
0
1000
2000
3000
4000
5000
6000
7000
8000
4,86
7
3,19
3
1,76
8
650
775
2,86
1
1,96
6 3,40
0
33 1 39
4,24
5
2,48
8
1,20
4
646
638
2,75
6
1,35
0
3,02
1
20 1 20
Dependable Capacity, MW
Installed Capacity, MW
Gross Installed Capacity – 19,553 MWGross Dependable Capacity – 16,389 MW
MW
CHALLENGES
• Sugar Tariff Schedules and Implications
• Maintaining Profitability in the Philippine Sugarcane Industry
• Performance of Philippine Sugar Mills and Deterrents to Mill Improvements
• Implementation of the Biofuels and Renewable Energy Laws
Sugar Tariff Schedules and Implications
AFTA – CEPT Tariff
Schedule:
2011 - 38 %
2012 - 28 %
2013 - 18 %
2014 - 10 %
2015 - 5 %
Implications:• Entry of imported sugar would threaten
the livelihood of the 62,000 farmers
and 600,000 workers of the
Philippine sugarcane industry
• Entry of imported sugar will push
downwards the millsite price of locally-
produced sugar
Maintaining Profitability in the Philippine Sugarcane Industry
• Fragmented farms due to the Comprehensive
Agrarian Reform Law
• Small farms have low farm productivities
• Small farmers have no financial capability in
procuring the necessary farm inputs
• Lacks infrastructure support from government
Performance of Philippine Sugar Mills and Deterrents to Mill Improvements
• Less efficient sugar mills, low capacities
• Majority of Philippine mills need to be
rehabilitated and upgraded
• Lack of financial package from government
financing institutions
Implementation of the Biofuels and Renewable Energy Laws
• Uncertainty in the buying price of bioethanol –
how successful is the implementation of the price
index of locally-produced bioethanol
• Feed-in-tariff rate for biomass is still pending
with the Philippine Energy Regulatory Commission
• Prospects for Cane Expansion Areas
• Access to Japan Sugar Market thru PJEPA
• Creating Greater Value for Sugarcane
• Bioethanol Production
• Power Cogeneration
• Increased Farm Mechanization Due to Labor
Supply Shortage
• Sustaining Domestic Requirement and
Maintaining World and US Quota Exports
OPPORTUNITIES
Prospects for Cane Expansion
Areas• Most Philippine sugar mills are underutilized due to the lack of cane supply
• Development of expansion areas for sugarcane to supply the feedstocks
for bioethanol fuel
Access to Japan Sugar Market thru
PJEPA• Proposal of the Philippine gov’t under the Phil.-Japan Economic Partnership
Agreement (PJEPA) for a TRQ of 150,000 MT raw cane sugar with an
in-quota rate of 4.415 yen per kilo and 1,000 MT of muscovado sugar
with an in-quota rate of 17.65 yen per kilo.
Creating Greater Value for Sugarcane
• Product diversification or development of alternative or
high-value products
• Production of organic sugar
• Turning a community of small cane farmers into an
agribusiness enterprise
Bioethanol Production
• Thirteen more distilleries with an annual capacity of
30 million liters are required to meet the volume requirement
of the 10 % mandate of bioethanol blend
Power Cogeneration
• Existing power generating capacity of all the sugar mills in the
Philippines is 200 megawatts;
• Given the right investment environment, the boilers and power
generators of such mills can be upgraded up to 600 megawatts
making available 400 megawatts for power cogeneration
• The Philippines is currently experiencing power shortages and
the power generated by the sugar mills could help solve the
country’s problem on power deficit
Increased Farm Mechanization Due to Labor Supply Shortage
• Farm laborers in the Philippines became scarce and the
new generation are no longer inclined in farming but
preferred to work overseas
• The shortage of farm labor triggered the shift to farm
mechanization in the Philippines
Sustaining Domestic Requirement and Maintaining World and US Quota Exports
• The Philippines has to be a net exporter of sugar by 2015 in
order to be in the offensive move rather than be flooded with
imported sugar
• More opportunities for investment in mill
modernization, infrastructure and farm and equipment are
seen to flourish in the Philippines given the need to be
competitive in world sugar production
Thank You
Website : www.sra.gov.ph
Email : [email protected] [email protected]
Tel. No. : (632) 929-3633 (632) 455-2135