This document discusses plans to diversify and expand the Philippine sugarcane industry. It provides an overview of the current industry profile and maps out a vision for a fully integrated sugarcane industry by 2027 that produces sugar, ethanol, power and other products. Key elements of the plan include increasing farm productivity, expanding sugarcane areas through block farming, developing sugarcane eco-zones, and enacting legislation to support the industry. The integration of the ASEAN economic community in 2015 is also addressed, emphasizing the need for industry competitiveness.

1. Diversifying the Sugarcane
Industry
March 11, 2014

2. Part I:
The PHL Sugarcane Industry
Vision and Roadmap

3. VISAYAS
(18 mills + 7
refineries
+ 3 distilleries)
MAP OF PHILIPPINE SUGAR MILLS & BIOETHANOLMAP OF PHILIPPINE SUGAR MILLS & BIOETHANOL
DISTILLERIESDISTILLERIES
LUZON
(7 mills + 4 refineries + 1
distillery)
NEGROS
MINDANAO
(4 mills + 3
refineries)
TARLAC
Batangas Sugar
CAM
ARINES
SUR
PAMPANG
A
CAGAYAN
ILOIL
O
CAPI
Z
LEYT
E
CEB
U
BUKIDNO
N
DAVAO DEL
SUR
Dava
o
NORTH
COTABATO
NEGROS
OCCIDENTAL
NEGROS
ORIENTAL
Lopez
Sa
Tolong
AGUSAN
DEL
NORTE
BOHO
L
LANAO
DEL
NORTE
MASBAT
E
MISAMIS
OCCIDENTA
L
MISAMIS
ORIENTA
L
SAMA
R
SURIGAO
DEL
NORTE
SURIGAO
DEL SUR
ZAMBOANGA
DEL NORTE
ZAMBOANGA
DEL SUR
SOUTH
COTABATO
PALAWAN
Legend
MANIL
A
Sugar mills
Mills with annexed refinery
Major sugar
ports
SAN CARLOS
5,000 HECTARES
Green Future Innovations
CAGAYAN / ISABELA
11,000 HECTARES
Bioethanol production
areas Pampanga 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

5. Present Profile
Philippine Sugarcane Industry
contributes P76B to the economy
Present Profile
Philippine Sugarcane Industry
contributes P76B to the economy
Sugarcane
Farms
62,000 farmers62,000 farmers
and increasingand increasing
90% of farms90% of farms
are 10 hectaresare 10 hectares
& below& below
422,384422,384
hectares ofhectares of
sugarcanesugarcane
plantationsplantations
Productivity:Productivity:
58 TC/Ha58 TC/Ha
1.99 LKg/TC1.99 LKg/TC
Sugarcane
Farms
62,000 farmers62,000 farmers
and increasingand increasing
90% of farms90% of farms
are 10 hectaresare 10 hectares
& below& below
422,384422,384
hectares ofhectares of
sugarcanesugarcane
plantationsplantations
Productivity:Productivity:
58 TC/Ha58 TC/Ha
1.99 LKg/TC1.99 LKg/TC
Power
Generation
- all mills are self-
sufficient on power
- 2 mills and 2
distilleries are
supplying to the
grid
- 5 mills are
preparing to
supplying to the
grid
Bio-ethanol
Producers
4 Bioethanol4 Bioethanol
DistilleriesDistilleries
35% Production35% Production
capacity ofcapacity of
mandated marketmandated market
Sugar Mills
28 Sugar Raw28 Sugar Raw
MillsMills
- 202,500- 202,500
MT/dayMT/day
14 Sugar14 Sugar
RefineriesRefineries
- 8,000 MT/Day- 8,000 MT/Day
70% capacity70% capacity
utilization ofutilization of
millsmills

6. Highly-
Efficient
Mills
10
Bioethanol
Distilleries
Sugar Mills
Generating
500 MW
power
Specialty
Sugar, Bio
Water, Bio
Plastics,
etc.
Expansion of Sugarcane Areas
and
Increase in Number of Large Farms (Block Farming)
Sugarcane
Eco-zones
Farm
Support
Industrie
s
Mill
Support
Industrie
s
Fully
Integrated
Sugarcane
Industry
Y2027
Foundation
for
Development
Support
Activities
Goals
Vision

7. Vision
Fully Integrated Sugarcane Industry
Sugar, Ethanol, Power & Others (Bio-water, Bio-plastic,
etc)
Vision
Fully Integrated Sugarcane Industry
Sugar, Ethanol, Power & Others (Bio-water, Bio-plastic,
etc)
Highly
Productive
Sugarcane
Farms
- 75 tons per
hectare (national
average)
- 2.1 bags per ton
cane sugar
recovery
Highly
Productive
Sugarcane
Farms
- 75 tons per
hectare (national
average)
- 2.1 bags per ton
cane sugar
recovery
Sugar Mills and
Distilleries
Supplying
Power To the
Electric Grid
- 200 MW sold to
the grid
Highly
Efficient Bio-
ethanol
Distilleries
- producing
100% of volume
required of PHL
mandatory
blend
-
Highly
Efficient
Sugar Mills
- 80% milling
capacity
utilization
- 85% sugar
recovery
Production
of other
sugarcane-
based
products
- bio-water
- bio-plastic
- muscovado
sugar
- specialty
sugars
- others
Production
of other
sugarcane-
based
products
- bio-water
- bio-plastic
- muscovado
sugar
- specialty
sugars
- others

8. A Multi-Product Sugarcane Industry Towards Inclusive Growth

9. Raw Sugar
• Bio-Power
(electricity)
• Bio-water
• Bio-
fertilizer
• Bio-plastic
• Battery
Refined Sugar Molasses
Traditional Products from SUGARCANE
Future Products from SugarcaneFuture Products from Sugarcane
Future Products from Sugarcane

10. Increase Economic Contribution to P100
Billion
Sugar Self-sufficiency:
Local Demand of 2.3 million MT meet
Annual exports of 150,000 mt sustained
Bio-ethanol self-sufficiency:
Save dollars for 400 million liters gasoline annually
Use of Green Renewable Fuel
Power Co-generation:
200 MW electric power delivered to the grid
Renewable fuel using bagasse
Land Productivity Improvement:
40,000 to 100,000 hectares land more productive
Employment of about 50,000 to 100,000 in rural areas
New Products:
New Industries and New Services Established

11. The
ASEAN Economic Integration
in 2015:
Implications and PHL
Preparations
PART II

12. NY #11: World Market Price ($US cents per pound)NY #11: World Market Price ($US cents per pound)
US$0.14 US$0.15 US$0.16 US$0.17 US$0.18
Dollar:Dollar:
PesoPeso
ExchangeExchange
RateRate
₱40.00 ₱896.80 ₱943.00 ₱989.20 ₱1,035.40 ₱1,081.60
₱41.00 ₱912.97 ₱960.33 ₱1,007.68 ₱1,055.04 ₱1,102.39
₱42.00 ₱929.14 ₱977.65 ₱1,026.16 ₱1,074.67 ₱1,123.18
₱43.00 ₱945.31 ₱994.98 ₱1,044.64 ₱1,094.31 ₱1,143.97
₱44.00 ₱961.48 ₱1,012.30 ₱1,063.12 ₱1,113.94 ₱1,164.76
₱45.00 ₱977.65 ₱1,029.63 ₱1,081.60 ₱1,133.58 ₱1,185.55
Tariff Rate: 5% Shipment & Other Costs: P250.00 per bag
Sensitivity Analysis of Imported Raw Sugar Price at 5%
Tariff

13. Cost of Production per Hectare
₱60,000 ₱70,000 ₱80,000 ₱90,000 ₱100,000
SugarcaneSugarcane
ProductionProduction
perper
HectareHectare
(tons/Ha.)(tons/Ha.)
40 ₱1,111 ₱1,296 ₱1,481 ₱1,667 ₱1,852
50 ₱889 ₱1,037 ₱1,185 ₱1,333 ₱1,481
60 ₱741 ₱864 ₱988 ₱1,111 ₱1,235
70 ₱635 ₱741 ₱847 ₱952 ₱1,058
80 ₱556 ₱648 ₱741 ₱833 ₱926
90 ₱494 ₱576 ₱658 ₱741 ₱823
Sharing: 67.5% Planter share Sugar Recovery: 2.0 LKg/TC
Sensitivity Analysis on Cost of Production
Per 50-kg Bag Raw Sugar

14. Industry Competitiveness Strategy
• Increase Farm Productivity
• Reduce Cost of Production
• Increase Mill Efficiency
• Diversify Product Stream to
Increase Income of Producers

15. Preparations for the
ASEAN Integration in 2015
1. Productivity
Improvement
- Technology Adoption
- Block Farming
2. Industry Diversification
- Now Sugarcane Industry -
not just a sugar industry
- Diversified products of
Sugar, Ethanol and Power
3. Responsive Regulatory
Framework
- Enactment of rules and its proper
and transparent implementation
4. Development of
Infrastructure Support
- Improvement of Farm-to-mill
roads, irrigation, mechanization
5. Active Market Research
6. Enactment of the Sugarcane
Development Act

16. Development Imperatives
• Active Government Support
• Productive Public-Private Partnership
• Strong Research and Development (R&D)
• Innovative Technology Transfer System
• Responsive Support Industries for the Farms,
Mills and Distilleries
• Responsive Financial and technical
assistance packages

17. IDENTIFYING THE SUGARCANE FARM: MAPPING PER BARANGAY

18. BLOCK FARM
Agribusiness Unit
DAR
- organizational devt
- land tenure
improvement
DA
- Other crops
-Infrastructure
SRA
- Technical
Assistance
- Technology
Transfer
DTI
- Marketing
- Investments
DOLE
- skills Devt,
Agriprenuership,
productivity
improvement
DOE
MDDC:
Conduit of Initiatives
& Coordination
INCREASING NUMBER OF LARGE FARMS: BLOCK
FARMING
Service Provider
Farm
Management &
Technical
Consultancy
Equipment
Services
Finance and
Financial
Services
Support Services
Planters
Association/
Sugar Mills/
Ethanol
Distilleries/
Industrial Users
Enterprise Dev't.
Marketing
Investment

19. FARM SUPPORT INDUSTRIES: MUST BE PRIVATE BUSINESSES
SUGARCANE
FARM
SUGARCANE
FARM
Farm
Management
& Technical
Consultancy
Tractor Services
Finance and
Financial
Services
Supply of
Fertilizer &
Other Inputs
Equipment
Manufacturing
Product
Diversification
Harvesting
and Hauling
Services

20. MILL SUPPORT INDUSTRIES: MUST BE PRIVATE BUSINESSES
SUGAR MILL /
DISTILLERY
SUGAR MILL /
DISTILLERY
Foundry and
Machine
Shop
Engineering &
Design
Construction
Repair and
Maintenance
Product
Diversification
Equipment
Design and
Manufacturing

21. SUGARCANE ECO-ZONES: RURAL DEV'T HUBS
SUGAR MILL
/
DISTILLERY
SUGAR MILL
/
DISTILLERY
Sugar-based
Food
Manufacturing
Foundry and
Machine Shop
Block Farms
Equipment
Manufacturing
Equipment
Manufacturing
Consultancy &
Advisory
Fertilizer & Input
Manufacturing
Bio-water, Bio-
plastic & other
by- products
Bio-water, Bio-
plastic & other
by- products

22. MILL DISTRICT DEVELOPMENT COUNCIL (MDDC)
MDDC:
Managing the
Dev't of the Mill
District
MDDC:
Managing the
Dev't of the Mill
District
Farm-to-Mill
Road
HYV Planting
Irrigation
Farm
Database
Crop
Estimate
Equipment
Services

23. How the Sugarcane Act Can Help
• Task concerned government agencies to support the
industry
• Provide development funds for improvement of the
farms and mills
• Line budget funds for farm-to-mill roads and irrigation
systems
• Incentives to Block Farms
• Mandate the creation of Sugarcane Eco-zones
• Framework for development of other sugarcane-based
products

24. Website : www.sra.gov.ph
Email : srahead@sra.gov.ph
info@sra.gov.ph
Tel. No. : (632) 929-3633
(632) 455-2135