The Philippines' domestic bioethanol reference price for April rose 3.44% month on month to a 13-month high at Pesos 53.54/liter ($1,070.80/cu m), data released Tuesday by the country's Sugar Regulatory Administration showed.
The domestic bioethanol reference price was last higher in February 2017 at Pesos 54.70/liter, before it fell 22.34% to a five-year low at 42.48/liter in November 2017.
The domestic Negros molasses price rose 3.64% month on month in April to a seven-month high at Pesos 7,525.02/mt, resulting in a higher equivalent feedstock cost of Pesos 32.55/liter. The equivalent sugarcane feedstock cost in April was Pesos 29.95/liter, equating to a sugarcane price of Pesos 2,096.22/mt, up Pesos 173.16/mt (9%) from March.
The domestic Philippines' sugarcane price was buoyed by an increase in demand from beverage makers on the back of the Tax Reform for Acceleration and Inclusion, or TRAIN, which imposed taxes on sweetened beverages from January 1, 2018.
The tax is Pesos 6 (12 cents)/liter on drinks containing calorific or non-calorific sweeteners and Pesos 12/liter on drinks containing high-fructose corn syrup, or a combination of both. This is expected to result in an increase in sugar consumption at the expense of HFCS, S&P Global Platts Analytics reported.
Major soft drink makers like Pepsi-Cola Products Philippines has announced it will reformulate its mix to 100% sugar from May, from 60% sugar and 40% HFCS earlier, market sources said.
The Philippines' April domestic bioethanol price was up Pesos 4.85/liter (9.96%) from Pesos 48.69/liter in April 2017, Platts data showed.
The average CIF Philippines fuel ethanol price for April was $486.75/cu m, making the domestic price more than double that of imported ethanol, Platts data showed.
The Philippines' domestic bioethanol reference price is calculated by adding transportation costs to the average cost of two major feedstocks for ethanol production, molasses and sugarcane.
