Pakistan sugar industry seeks additional export clearance for 0.8 million tonnes amid Rs 98 billion losses
Pakistan’s sugar industry has reported losses of Rs 98 billion amid a 1.3-million-tonne surplus and sugar prices falling up to 25% year-on-year. The PSMA has urged the government to approve an additional 800,000 tonnes of exports to ease financial pressure and clear inventories.
Lahore: Pakistan’s sugar industry has reported losses of Rs 98 billion amid a surplus of 1.3 million tonnes and a decline of up to 25% in sugar prices over the past year, prompting the Pakistan Sugar Mills Association (PSMA) North Zone to seek additional export permission for 800,000 tonnes, Business Recorder reported.
Citing weekly data from the Pakistan Bureau of Statistics (PBS), the association said domestic sugar prices had fallen sharply over the past year, leaving mills struggling to recover production costs and meet financial obligations.
In a statement issued on Sunday, a PSMA-North Zone spokesperson said the industry had repeatedly urged the government to allow timely exports of surplus sugar following the closure of the 2025-26 crushing season. However, delays in policy decisions had left substantial stocks unsold, increasing financing and inventory-carrying costs.
The association said at least 12 sugar mills across Pakistan had already shut down because of mounting losses, while several others were facing the risk of closure. The financial strain could also affect the timely commencement of the 2026-27 crushing season and mills’ ability to offer remunerative prices to sugarcane farmers.
According to the PSMA, Pakistan is heading into the new crushing season with an estimated sugar surplus of 1.3 million tonnes. The industry expects another strong production season, with output projected at approximately 8.5 million tonnes.
The association warned that the arrival of fresh production without clearing existing inventories could intensify the supply glut and further depress domestic prices. It said mills were also facing substantial interest expenses on bank borrowings used to finance unsold sugar stocks.
The PSMA further claimed that sugar prices in Pakistan were among the lowest globally despite the country having relatively high sales tax rates on the commodity.
To ease the situation, the association has urged the federal government to permit exports of an additional 800,000 tonnes of sugar over and above the 200,000 tonnes already approved. It argued that exporting at least 1 million tonnes of surplus sugar was necessary to restore financial stability in the industry.
The industry has also called for complete deregulation of the sugar sector, allowing market forces to determine prices and guide commercial decisions.
The PSMA warned that failure to address the surplus could have wider implications for sugarcane growers, sugar mills and the country’s agricultural economy. It added that Pakistan could eventually be forced to import sugar to meet domestic requirements, resulting in foreign exchange expenditure instead of earning export revenue from surplus production.
To Read more about Sugar Industry continue reading Agriinsite.com
Source : ChiniMandi
