KARACHI, June 6: Despite the slow trading activities witnessed in Dandia Bazaar (wholesale market) following the federal budget announcement, the price of sugar witnessed a slight increase of Rs1.50 to Rs2 per kg.
Talking to Dawn, traders at Dandia Bazaar said that the increase in sugar prices has nothing to do with the budgetary measures since the ‘government has not imposed sales tax of 16 per cent as was anticipated’.
Chairman Karachi Who-lesalers Grocers Association (KWGA) Anis Majeed said that the wholesale price of sugar now hovers between Rs 52.50 to Rs 53.00 per kg as compared to Rs 51.00 per kg earlier on.
“Some buying activity ahead of Ramazan which begins in July is one of the reasons behind the slight increase. Due to lack of buying last month, sugar prices in wholesale market were falling.
Secondly, the opening of tender of 200,000 tons by the Trading Corporation of Pakistan (TCP) on Thursday also caused fluctuation in prices,” he informed.
Retailers are already charging Rs 55 per kg. However, they said that they have not increased the prices yet but will see the wholesale market rate after opening of TCP tender on Thursday.
Sugar exports have also picked up and from March 2012 to April 2012 export stood at 23,776 tons ($14.8 million). There was no sugar export in July-April 2010-2011.
A sugar miller, on the condition of anonymity, linked the slight jump in price to pre-Ramazan activities coupled with opening of TCP tender.
He said that exports are picking up at a snails pace owing to paper work with the banks. He went on to add: “India is already in the world market. When millers asked the government to allow sugar exports, the price in world market was $700-800 per ton (FOB) while now it hovers between $500-520 per ton.”According to figures of Large Scale Manufacturing, the country produced 15 per cent more sugar to 4,485,592 tons in July-March 2011-2012 as compared to 3,892,141 tons in the same period of last fiscal year.
Data in the Economic Survey 2011-2012 shows that sugarcane production for the current year is estimated at 58m tons as compared to 55.3m tons in the last fiscal year.
The main factors contributing to the production increase are lucrative market prices of last year’s produce and timely availability of inputs which encouraged far-mers to grow more sugarcane.