November 01, 2006	Wednesday	Shawwal 8, 1427

LAHORE, Oct 31: As the sugar prices begin to escalate after the imposition of five per cent regulatory duty and 10 per cent customs duty on the import of the sweetener, the next sugarcane harvest in Punjab is feared to be delayed for at least one week owing to what millers describe as “shortage” of labour.

“We are facing an acute shortage of labour needed for the sugarcane harvest and other purposes, which can delay the start of actual crushing until the end of the third week or the start of last week of November,” Pakistan Sugar Mills Association (PSMA) leader Zaka Ashraf told Dawn on Tuesday.

He said almost the entire labour employed for sugarcane harvest and its transportation to the mills came from the NWFP. “They (the labour) have so far not returned to Punjab for work because most of them are reported to have gone to Azad Kashmir for collecting compensation money being disbursed by the government among the survivors of last year’s earthquake on allegedly illegal and fake documents,” he said.

The PSMA had assured the government that its members would begin cane crushing in Sindh from November 1, and in Punjab from November 15 after the secretaries’ committee, constituted by the prime minister to ensure on-time sugar harvest in the country, accepted their demands and conditions for starting actual crushing.

In line with the commitment given to the sugar millers in return for agreeing to begin crushing on the given dates, the government has already levied 15 per cent duty, including five per cent regulatory duty, on the import of raw and white sugar.

It also got the central bank to withdraw its earlier order to the commercial banks imposing restrictions on fresh financing to the sugar mills against their stocks.

“We have sent out our (labour) contractors to bring back the labour from the NWFP. However, it may take some extra time (to bring back the labour) and the next harvest may be delayed by one week,” said Mr Ashraf.

To a question, he said the mills in Sindh would take the decision to start the crushing on November 6. “The cane crushing in Sindh has been delayed because of the police action against a former office-bearer of the PSMA and his mill by the Sindh government,” Mr Ashraf said.

“Now the Sindh government has withdrawn the charges against the said miller, and the millers have decided to sit together for deciding when to begin crushing, he added.”

In the meanwhile, the wholesale sugar rates have been upped by Rs100 per 100kg bag during the last couple of days. The sugar dealers blame the mills for increasing the price after the imposition of duty on the sweetener’s import.

The millers claim that their ex-mill rate was still Rs33 per kg, and that the sweetener was available in the retail for Rs34-34.50/kg. However, the market reports said the sugar price had shot up to Rs36 per kg in retail, and traders fear it will further rise.

Mr Ashraf said the increase in the sugar rates signified “correction” in the market. The sugar rates had crashed during the last couple of months because of heavy sale by the Trading Corporation of Pakistan at highly subsidised prices. “In order to pay the growers at the new support price of Rs60 per maund in Punjab it is necessary that the sugar rates stabilise at a reasonable level,” he said.