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KARACHI: Pakistan is expected to produce over 0.5 million tons of exportable surplus of sugar after a bumper sugarcane crop this season.
However, the indifferent attitude of the government towards low cane price and falling sugar rates in the open market will take a toll on the growers and sugar industry.
Industry leaders talking to Dawn on Tuesday maintained that the current situation called for bold decisions from policymakers ‘who must allow export of white refined sugar and bag high price prevalent in the world market’.
“Low sugar prices in the open market are threatening the viability of the industry and damaging the growers’ interest. The current price of Rs55 per kg (wholesale price Rs48.30 kg) does not cover production cost. There is acute liquidity crunch in the sugar industry which is making the current crushing season difficult,” said Sikander Khan, a miller from Khyber-Pakhtunkhwa.
“It is difficult to understand why the government is allowing smuggling of sugar and gur (brown sugar) to Afghanistan but is not ready to allow exports which will earn foreign exchange and also bring revenue to national exchequer,” he questioned.
He said allowing exports would help ease pressure on domestic prices of cane and sugar besides earning foreign exchange to the tune of $400 to $500 million.
“The move will help stabilise prices of both cane and sugar in domestic market. It will be a win-win situation for all,” said Muhammad Kasim Hashim, a sugar mill owner from Sindh.
This season the growers had paid higher prices for fertilisers and were not getting due return of their produce due to prevailing low cane and sugar prices.
They maintained that low sugarcane price was hurting around 40 million growers all over the country because the current cane price of Rs150 per 40 kg was very low compared to last year’s Rs200 to Rs250 per 40 kg.
Responding to a question, Hashim said that bumper cane crop could help produce around 4.8 million tons against total domestic consumption demand of around 4.3 million tons. Besides, he said the Trading Corporation of Pakistan (TCP) also holds around 0.2 million tons of buffer stocks.
The current high prices in the world market would fetch huge foreign exchange if government allows export of surplus sugar. World sugar prices are presently being quoted at $640 per ton, he added
