LAHORE, July 27: Traders on Tuesday accused sugar mills of having formed a cartel to increase their ex-mill prices by Rs1.70 per kilo in the last eight to 10 days.
"The millowners have increased the prices ahead of Ramazan by creating an artificial shortage of the commodity in order to mint money," said a trader, who asked not to be named.
He claimed the ex-mill prices of sugar had gone up to Rs19.20-19.50 per kilo from Rs17.50-17.80 per kilo. "The rapid rise in sugar rates is quite surprising in view of the stocks lying with the mills," he said, adding some 19 million tons of sweetener was available with the mills on June 15 for four-and-a-half months before the start of fresh crushing on Nov 1.
Besides, he said, the mills had also sold excess sugar stocks to the Trading Corporation of Pakistan (TCP) which, at present, had 4.66 million tons of the sweetener with it.
"The government had directed the TCP to procure surplus sugar from the mills in order to support the prices which were under pressure due to the unsold stocks available with the mills," the trader said.
"The other purpose of this decision was to stabilize the market and hold down the retail sugar rates at a reasonable level to protect the consumers from profiteering at the expense of the consumers if and when needed.
Therefore, it is in the best interest of the consumers of this country that the TCP should at once intervene in the market and sell its stocks to bring down the retail prices," he said.
When contacted, Pakistan Sugar Mills Association (PSMA-Punjab) member said the recent price increase was caused by "hoarders" and not by the mills. He claimed that the ex-mill rates had gone up by just Rs30-40 per 100kg that was not much in view of the forecasts of a bad sugar cane crop this year.
