KARACHI: Amid the lack of any government interest towards rising commodity prices, the sugar price in Jodia Bazaar, the country’s main wholesale commodity market, further surged to Rs136-137 per kg on Saturday from Rs131-132 a few days back mainly due to an export-driven spike in demand.

In less than 20 days, the wholesale rates have swelled by Rs19 per kg as speculators and hoarders have taken over the market, wholesalers and retailers said.

According to the Sensitive Price Index (SPI) for the week ending on July 13, sugar retail price in Karachi was hovering at Rs138-150 per kg as compared to Rs128-135 in the preceding week ending June 22.

Country-wide sugar prices had also surged as the national average rate of sweetener rose to Rs135-150 per kg from Rs124-140 some 20 days back.

Wholesalers jack up rates by over Rs19 in three weeks

Retailers said sugar price would cross Rs150 per kg in case of any further jump in wholesale rates next week.

However, retailers, holding old stocks purchased at lower rates, are now cashing in on the situation by charging higher prices from the consumers.

Faisal Anis Majeed, a commodity trader, said the demand for sugar had been increasing after the government allowed in January sugar mills to export excess quantities to neighbouring and other countries.

He said the country has ample sugar stocks to meet demand for the next six months before the start of the new crushing season in October/November. “Sugar mills are holding back on their stocks anticipating further hikes in prices,” he added.

Besides, sugarcane support price is reportedly being increased to Rs450 per maund for the new season which would translate equal it to about Rs135-136 per kg. The market has already started picking up on this wholesale price.

According to the data of Large-Scale Manufacturing, sugar production during 11MFY23 fell by 15pc to 6.7m tonnes from 7.907m tonnes in the same period last fiscal year.

Another commodity importer said that Afghanistan was not lifting sugar from India and Brazil. Now Pakistani sugar is finding its way into Afghanistan through informal channels.

Pakistan exported sugar at an average rate of $484 per tonne. Export from February till to date stood at 214,789 tonnes ($104m).

Published in Dawn, July 16th, 2023