ISLAMABAD, April 1: The Pakistan Sugar Mills Association (PSMA) on Friday confirmed that the country would experience a net shortage of about 600,000 tons of sugar during the current year but challenged an official claim that mills were releasing their stocks slowly.
Secretary-General of PSMA K.A. Qazilbash said that mills “routinely” kept a stocks of about 2.5 million tons of sugar during the March-April period every year. “Sugar is produced in four months (December-March) and utilised over the next 14 months”, said Mr Qazilbash.
He confirmed that PSMA had stopped releasing quarterly figures because the government and the media had been “misinterpreting” the data.
He said that it was “wrong” to say that mills were releasing less sugar in the absence of rationing. The PSMA secretary-general said that mills in need of urgent funds to meet their banking liabilities sold their stocks at available rates but those which were in a financially comfortable position, afforded to wait for a better price, adding that it was the market mechanism.
Informed sources said that sugar production during the current year was estimated at 2.85 million tons, including domestic production of 2.5 million and 350,000 tons from raw sugar. Another 200,000 tons of sugar had been imported while there was a carryover of 550,000 tons from the past year.
The sources said that the PSMA had already informed the government about the impending shortage a few days ago and advised it to take immediate steps to import sugar at an early stage, adding that the international market was likely to tighten after the June-July period. Sources said that unless the government imported now, sugar prices in the local market would spiral if there was a real shortfall.
As such, total sugar availability during the current year was estimated at 3.6 million tons against an estimated annual consumption of 3.85 million tons, leaving a shortfall of 250,000 tons. The country required a buffer stock of about 600,000 tons for the October-November period and hence the total shortfall was estimated at 850,000 tons.
About 250,000 tons of sugar is currently in the import phase, including about 100,000 tons by the Trading Corporation of Pakistan (TCP) and about 150,000 tons by the private sector. This meant that there would be a net shortfall of 600,000 million tons.
The TCP currently held about 190,000 tons of sugar stocks. Of this, 110,000 tons were lying with the sugar mills while the remaining 80,000 tons were in other warehouses.
PSMA’s statistics for the period up to Feb 28 suggested that Brother Sugar Mills released only 11.28 per cent of its 31,400 tons while the Chaudhry Sugar Mills released about 18.2 per cent of their 35,000 tons of production. The Punjab Sugar Mills released slightly over 34 per cent of its total production while Ramzan Sugar released 27 per cent of its total production.
The C.S.K (Phalia) was one of the few mills in Punjab that released more than 50 per cent of its total production while Pahrianwali released about 100 per cent of its production.
