JCL Metro Bacolod Rotary

8/6/2019 JCL Metro Bacolod Rotary

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A Presentation to theRotary Club of Metro-Bacolod

Adm inistrator James C. Ledesma

Sugar Regulatory Administration

Sugar Industry Today,Sugar Industry Today,Directions for TomorrowDirections for Tomorrow


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Sugar MillingLocation of Mills

12 operating mills inNegros Island

7 operating mills in Luzon 4 mills in Mindanao 3 mills in Panay

2 mills in Cebu 1 mill in Leyte

Sugarcane is produced in 17provinces located in 8 regions

Negros island accounts for 56%

of total production Milling season ~ 180 days

Bukidnon Sugar Co. is the biggest mill(18,000 TCD cap) and Victorias hasthe biggest refinery(more than 20,000 bags/day)


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Raw Sugar Production/Consumption,CY 99/00 to 05/06 (in Metric Tons)

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

Production

Consumption

Production 1,619,613 1,805,203 1,898,501 2,161,000 2,338,000 2,150,746 2,138,000 2,240,000

Consumption 1,928,000 1,908,000 1,942,000 2,059,000 2,040,000 1,950,585 1,910,000 1,950,000

CY 99-00 CY 00-01 CY 01-02 CY 02-03 CY 03-04 CY 04-05 CY 05-06 CY 06-07

Sugar self sufficiency attained in CY 2002-03. CY 03-04 record is a 20-year high.

Projected


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Recovery Percentage

CY 2000-01 to CY 2004-05

8

8.2

8.4

8.6

8.8

9

9.2

9.4

9.6

CY

2000

-01

CY

2001

-02

CY

2002

-03

CY

2003

-04

CY

2004

-05

% Recovery

CY 2000-2001 8.55%CY 2001-2002 9.00%CY 2002-2003 9.15%CY 2003-2004 9.05%CY 2004-2005 9.55%


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FARM SIZE DISTRIBUTION CY 2004-05

391,712

has.Total areaplanted tosugarcane

100.0056,30469,772Total/Mean

0.70396736Over 100

1.498371,22850.01 - 100.00

2.891,6272,11425.01 - 50.00

6.983,9284,51010.1 - 25.00

9.505,3476,0715.01 - 10.00

78.4544,17045,113Below 5.0

%No. of FarmersNo. of FarmsFarm Sizes

(has.)

*In 2001 number of farmers were 51,261


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For Government Policy

For Research, Development & Extension PHILSURIN/ SRA

PHILSUTECHFor Technology & Education

For Social Action SIFI

SRA

For Policy Advocacy (Studies, Economics,Data & Statistics, Mill Technology) PSMA

For Policy Advocacy FarmersRepresentation

Sugar Alliance of the

Philippines(Planters Federations)Confed, NFSP, Unifed & Panayfed

For Value Added & Consumer Affairs PASRI

SUGAR M ASTER PLANFor Development and Competitiveness

MDDCFor Extension & Mill District Development


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Regulation ensure compliance topolicies

Research centered in its experimentstation in La Granja, Negros Occ.

Extension technology dissemination

Training basic training for smallfarmers

Services ISO certified laboratory

A U.S. marketB Domestic

C ReserveD World Market

Policy sugar allocation to itsappropriate market (A, B, C, D)

Sugar BoardChairman: DA SecMembers:

SRA AdminFarmers RepMillers Rep

SUGAR REGULATORY

ADMINISTRATION


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To help determine the policy directions of thesugarcane industry

Composition:

Farmers Federations: Confed

NFSP

Unifed

Panayfed

Millers Groups

PSMA

AIM

Objectives:To assist SRA in settingthe policy directions ofthe sugar industry

To maintain unity within theindustryTo undertake commoninitiatives for the benefit ofthe industry


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PHILSURIN a im s t o prov ide ap propr ia te& cos t and e f fec t i ve research ,

development , & ex t ens ion support t o

the Phi l ippine sugar indus t ry w i th s t a te -

of -th e-ar t t ech nology to im prove i ts

com pet i t i veness and a t t a in sel f -

su f f i c iency .

PHILSURIN Ac t iv i t iesPHILSURIN Ac t iv i t ies

Introduction of Modern Cultural Field Practices

Factory Automation & Modernization

Installation of Remote Weather Stations

Adoption of Geographic Information System

Breeding & Dissemination of High Yielding Varieties

Integrated Pest Management

PRIORITY PROJECTS

PHILSURIN is funded from a lien onproduction provided by the privatesector.


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Mill District Development Council

(MDDC) Created by SRA in 1991

There are 26 MDDCs in operation all overthe country

Composed of representatives fromfarmers and millers in the district togetherwith government and PHILSURIN

Provides extension services andaddresses the development needs specificto the district


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SIFI focuses on the overa l l g row t h & w e l l -be ing of sugar -produc i ng & mi l l ing areas.

As such, the pr inc ipa l t a rget o f i t s

development e f for t s a re sugar w orkers &

the i r dependents & t he c ommun i t i es i n

w h ich t hey l i ve .

SIFISIFI s Plans &s Plans &

ProgramsPrograms

Low-Cost HousingShelter

Hospitalization Insurance, Medical Mission,

Ambulances, Botica sa BarangayHealth Services

Microfinance, Cooperative DevelopmentLivelihood

Scholarship, Technical SkillsEducation

PRIORITY PROJECTS

SUGAR INDUSTRY FOUNDATION, INC. isalso funded from a lien provided by thesugar producers farmers and millers.


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Primary Objectives of the Master Plan

To increase Productivity Improve Production Efficiency, and

To reduce the unit cost of Production ofsugar in the Philippines

Established by the Sugar Industry to address theglobal competitiveness of the industry in relation todevelopments in WTO and AFTA.Funded by the private sector


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THE FUTURE OF THETHE FUTURE OF THE

SUGAR INDUSTRYSUGAR INDUSTRY --

To transform itself into the

SUGARCANE

INDUSTRY


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BIOETHANOLBIOETHANOLBIOETHANOL

Fuel ethanol and other biofuelshave regained nationwide

prominence due to rising oil

prices, concerns over theenvironment, development on

technologies in production, & theneed to support agriculture.


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WHY SUGARCANE ASSUBSTRATE?


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Ethanol Yield of Major Potential Biomass RawMaterials

5,20052Sweet Sorghum

2,960370Corn

1,440180Cassava

588280Molasses

4,90070Sugarcane

Ethanol Yield

(liters/ha/year)

Ethanol Yield

(liters / ton)Raw Materials


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Can we supply thefeedstock requirement?


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CY 2003-2004

SUGAR

PRODUCTION

2.34M MT

CY 2003-2004

PHILIPPINES

EXPORTED

164,000 MT

SUGAR

79%

EthanolRequirement

127.4 M

Liters

CANE SURPLUS TO SUPPLY ETHANOLREQUIREMENT


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269,757TOTAL

61,255Cagayan/Isabela/Zambales/Camarines Sur

19,400Bohol/Masbate/Kalinga

20,808Palawan

69,550Maguindanao

45,000Agusan del Norte/ Sur

19,700Saranggani

15,000South Cotabato

19,044Lanao del Norte

AREA (HA.)LOCATION

POTENTIAL CANE AREAS FOR EXPANSION

Results of Bio-Ethanol Study

Fuel Ethanol as Emerging Industry


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MODELS AND INVESTMENTREQUIREMENTS OF ETHANOL PLANTS

P 568M for 100,000

liters per day

Plants may be established

at a certain distance from

the mill

Plants may be established

at dedicated cane areas

Produces electricity for

own use or for distribution

to the grid

P 824M for 100,000

liters per day

P 1.5 Billion for

100,000 liters per

day

STAND-ALONE

USING MOLASSES

STAND-ALONE

USING SUGARCANE

JUICE

STAND-ALONE WITH

COGENERATION

Co-sharing of sugar mill

and distillery of existingamenities such as power,

water, steam and other

utilities

MODEL FEATURES

INDICATIVE

INVESTMENT

REQUIREMENTS

ADJUNCT TO SUGARMILL USING

MOLASSES

P 556M for 100,000liters per day


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39.7432.9019.2419.2412.415.5828.3221.431500

44.6237.7824.1224.1217.2910.4626.8920.001400

49.5042.6629.0029.0022.1715.3425.4618.571300

54.3847.5433.8833.8827.0520.2213.386.5524.0317.141200

59.2552.4245.5938.7631.9325.1018.2611.4322.6015.711100

64.1357.3050.4743.6436.8129.9823.1416.319.4821.1814.291000

69.0162.1855.3548.5241.6934.8628.0221.1914.367.5319.7512.86900

73.8967.0660.2353.4046.5739.7432.9026.0719.2412.415.5818.3211.43800

78.7771.9465.1158.2851.4544.6237.7830.9524.1217.2910.4616.8910.00700

P40P38P36P34P32P30P28P26P24P22P20

ETHANOL DISTILLERY PRICECOST

OFPRDTN

COST

OFSUB-

STRATE

COST

OFSUGARCANE

(100 LPD, Stand Alone, using Cane Juice as Substrate)

RATE OF INVESTMENT (ROI)


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Sixteen (16) 100,000 LPD distilleryplantsincreasing from 8 in 2007 to 16

in 2017 are projected to be required.

The key factors of a distillery investorsreturn on investment are the prices ofthe substrateestimated to be around

70% of his costand the selling price ofethanol from his distillery.


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1. The expedited and immediate passage of the Law thatshall mandate the development and the use of ethanolas blend to gasoline. This shall create the market and

consequently trigger investment in ethanol.

Challenges Ahead

2.2. The development of an alternative scheme to rawmaterial acquisition in lieu of the present sharing system.


3. Validation of identified areas as potential hosts toethanol production. Some of the areas were surveyedabout 10 years back necessitating validationvisits/studies.


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5. While sugarcane is seen as a major substrate forethanol, the development of other potential rawmaterials, particularly sweet sorghum and cassava,

must be pursued by pertinent government as well asprivate institutions.

4. The formulation of adequate government policy orpolicies to insure a positive market and investment

environment in the Philippines.

Challenges Ahead



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Policies & Direction in EthanolPolicies & Direction in Ethanol

Development Initiatives:Development Initiatives:

The Philippines intends to maintain a 2.0The Philippines intends to maintain a 2.0millionmillion mtmt sugar industrysugar industry

Formation of a Philippine Fuel Ethanol AllianceFormation of a Philippine Fuel Ethanol Alliancecomposed of alcohol distillers, sugar industrycomposed of alcohol distillers, sugar industry

representatives, government and some oilrepresentatives, government and some oilcompanies.companies.

Ethanol initiatives will focus on cane juiceEthanol initiatives will focus on cane juice

Canes required for ethanol will come mostlyCanes required for ethanol will come mostly

from expansion areas.from expansion areas. Legislation is being finalized in CongressLegislation is being finalized in Congress

mandating a blend of 5% for the first two yearsmandating a blend of 5% for the first two yearsand subsequently 10% after two more years.and subsequently 10% after two more years.


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With the se dire ct ions, the

Ph ilipp ine Sug a r In du stry, i f i ttra n sform s i tse lf, will ha ve

thre e p oten tia l bu s iness e s in

the ne a r fu ture :Sugar PowerEthanol


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Thank You!

www.e-sra.org
http://www.e-sra.org/http://www.e-sra.org/

JCL Metro Bacolod Rotary

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