KARACHI: Consumers continued to pay high prices for sugar despite Deputy Prime Minister Ishaq Dar’s firm announcement a few days back that the sweetener prices should not exceed Rs164 per kg.

The average national price of sugar in various cities was hovering between Rs164-180 per kg.

Karachi Wholesalers Grocers Association (KWGA) President Rauf Ibrahim recalled that wholesale rates of sugar plunged to Rs158 per kg in Karachi from Rs168 per kg soon after Prime Minister Shehbaz Sharif on March 15 announced a crackdown on hoarders. However, retailers did not pass on the impact of Rs10 per kg fall and continued cashing in on high demand during Ramazan.

The government has failed to ensure consumers can purchase sugar at Rs130 per kg. No serious crackdown has been launched against the millers, and only retailers face the music, Mr Rauf remarked.

As the other government’s relevant ministers have interacted with the sugar millers, the wholesale sugar rates have reverted to Rs168 per kg, he deplored, seeking an investigation of the cost of sugar production.

On Friday, a Pakistan Sugar Mills Association (Punjab Zone) spokesman said that some quarters under myopic considerations continuously create misunderstandings and link sugar prices with its exports.

“Surge in prices are not attributed to exports. At the end of September 2024, the industry had two years of surplus sugar production in the pipeline (approximately 1.2 million tonnes valuing Rs250 billion), which was pledged with banks at a nearly 25pc interest rate. Had the government not allowed the exports, Pakistan’s sugar industry, providing $5bn of import substitution and the world’s cheapest sugar, would have collapsed.”

He said the exports were allowed after much delay and after authenticating huge surplus stocks through multiple governmental sources.

Moreover, in June 2024, it was mutually agreed with the government that the ex-mill rate of sugar produced in crushing season 2023-24 and carry-over would remain Rs140 per kg during the export period. He added that the cost of sugar production, mainly dependent on sugarcane prices, is different in every crushing season, the spokesman said.

This season, he claimed that growers had received historically high sugarcane rates, up to Rs750 per maund, which provided them and the agriculture sector sustainability and prospects of better sugarcane crops in coming years. Hence, linking the sugar prices with its exports at a certain point for times to come is entirely biased and unjustified.

He further stated that sugar prices have been increased by influencing market forces through media campaigns by Satta Mafia, hoarders and Karyana Merchants for earning undue profits.

For the past many years, the sugar industry has been requesting the government that independent cost auditors be appointed to verify the cost of sugar production to make it more reliable and acceptable to all stakeholders.

The sugar industry has also urged the government to adopt a two-tier mechanism for determining separate sugar prices as the commercial sector consumes 80pc sugar and 20pc by domestic consumers. The commercial sector is completely unregulated and exempted from any price controls. The sugar industry would encourage devising a support mechanism for domestic consumers in consultation with the government.

Published in Dawn, March 22nd, 2025