The Philippines will get an additional 11,706 metric tons (MT) allocation of raw cane sugar on top of its 2010 allocated quota of 142,160 MT, Trade and Industry Secretary Jesli A. Lapus said.

Lapus said that the Philippines is among the top three beneficiaries of the unused quota reallocations after the 25 source countries of the US failed to deliver on their quota allocation for the year. The two other countries that are entitled to additional quota allocations are Dominican Republic with 15,262 MT and Brazil with 12,574 MT.

According to Lapus, the U.S. Trade Representative Office has decided to reallocate 81,496 metric tons raw value (MTRV) sugar after consulting with its quota holding countries, which are entitled to export a specified amount of sugar under the original tariff rate quota (TRQ) system.

Under the TRQ system, specific quota holding countries are allowed to export specified quantities of a product to the U.S. at a relatively low tariff, but subject all imports of the product above a pre-determined threshold to a higher tariff.

Lapus said the reallocation of sugar quota was seen as a prelude to a possible announcement by the U.S. government of an increase in overall quota for sugar due to high prices.

“This will be a rare opportunity to serve the U.S. market and take advantage of the additional sugar quota,” Lapus added.

The DTI said the Philippines was awarded with the additional sugar quota allocation because of its ability to supply the US. This has been an irony in the sugar industry because the local market at certain times encounter shortfall in supply and higher sugar prices. The country’s sugar producers, however, prefer to export to the U.S. market because it offers a premium on prices. The current U.S. price of sugar is about 33 cents per pound vis-a-vis the world price of only 17 cents per pound. The US price this year reached as high as 45 cents per pound.

Shortfall in sugar supply in the local market was tight during last December up to early this year and prices skyrocketed. Today, supply is already stable but prices still remain high at P42 a kilo for the refined sugar.