KARACHI, Jan 23: The unsold stocks of white refined sugar with sugar mills have risen to 0.459 million tons as the lifting, both from commercial traders and general wholesalers, is not in consonance with the rising production.

As a result wholesale prices in the open market have fallen to Rs1,920 from Rs1,980 per bag of 100 kgs.

According to production figures, released by the Pakistan Sugar Mills Association (PSMA) for the month of December 2001, the unsold stocks rose to 0.459 million tons from the previous 0.389 million tons after adding the carry-over stocks of 70,000 tons of last year.

The chairman, PSMA, Ashraf Tabani, told Dawn that if the government does not provide relief to the mills from their rapidly rising inventory the sugar industry would soon be pushed into financial crisis.

He said the on going gap between production and consumption of refined sugar will rise in coming months and mills are likely to be holding around 1.8 to 1.9 million tons with a market value of over Rs30 billion.

Tabani said that how an industry could keep on operating when more than 50 per cent of its working capital is blocked in unlifted stocks.

Responding to a question, he said, undoubtedly every year the industry has unsold or unlifted stocks of sugar but this year these stocks are much higher because of unbridled imports of sugar last year.

The PSMA chief said that the industry has asked the government to allow export of white sugar or at least should direct the state owned TCP to lift some stocks to maintain some buffer stocks of the essential commodity.

He said that a delegation of millers last week met the commerce minister but the meeting could not produce any result. Therefore, Ashraf Tabani said, now the PSMA is going to hold a joint meeting with the ministers of commerce and finance.

The sugar production up to Dec 31, 2002, stood at 0.646 million tons compared to 0.741 million tons produced in the same period last season.

Around 0.258 million tons have been lifted by wholesalers during this period leaving around 0.388 million tons of unsold stocks with the millers who were already carrying around 70,000 tons of last year’s unsold stocks.

During the period under review the white sugar production in Sindh stood at 0.646 million tons compared to 0.741 million tons of the corresponding period last year.