KARACHI, April 9: Pakistan is considering exporting at least 50,000 tons of refined sugar before June to reduce surplus stocks and support sagging domestic prices, a government official said on Friday.

Pakistan's refined sugar output is expected to hit a record 3.8 million tons in the 2003-04 (November-April) season, against 3.58 million tons in the previous season, according to industry officials.

With annual demand pegged at 3.324 million tons, the bumper output has pushed the price down to Rs15 ($0.3) per kg, which is below production costs, from Rs18.50 in October, traders said. "We have surplus production of at least 500,000 tons of white sugar," said a senior official at Pakistan's Ministry of Production and Industries who asked not to be identified.

"Export of 50,000 tons on immediate basis is under consideration," he said. High cane prices and production costs make Pakistan's sugar exports uncompetitive on the world market. "The exports will not yield any profits...but will support domestic prices and will provide some storage space for the new production," the official said.

London May sugar futures are currently at around $226 per ton, or lower than the prices in Pakistan. If the plan goes ahead, exports would be conducted through the state-run Trading Corporation of Pakistan rather than private traders. The trading firm had exported 100,000 tons of refined sugar in 2003.

"Exports through private traders are not feasible because high production cost makes our sugar prices well above the international prices," the official added. Attempts by Pakistani traders to export sugar in the past have largely failed because of high costs. A trade official in the port city of Karachi said the arrival of Brazilian sugar by the second week of May would hit world prices. -Reuters