Pakistan : Hike in sugar price during crushing season raises eyebrows
Amidst ample sugar stocks and a healthy sugarcane crop, recent price hikes of Rs 10-15 per kg have raised concerns. Market sources argue that there is no justification for the increase, given that over one million tons of sugar is available, with production continuing through November 2024. Speculators are suspected of influencing the price rise. The Pakistan Sugar Mills Association (PSMA) denies any price surge beyond the government’s Rs 140 per kg cap, set in June 2024. The Ministry of Industries has reassured the public that sugar prices remain stable, with retail prices around Rs 130 per kg.
Amid sizeable sugar carryover stocks health crops size, sugar price hike right in the middle of crushing season have raised eyebrows.
In the absence of sugarcane indicative price, millers are virtually given free hand in buying produce from growers at their own sweet will. Not only this, powerful sugar manufacturers are free to determine price of commodity as well, said market sources. They confirmed that a rising trend in price of sugar is being seen in the market lately.
According to them, Rs10-15 per kg increase in sugar price have no justification. During ongoing crushing season 2024-25, ample stock of sweetener is available in the market and there is no justification of any price rise of sugar. Physical sugar stock as on Nov 30, 2024 was above 766,093 tons and production from Nov 16 to 30 2024 was 183,960 tons.
Hence, well over one million ton of sugar is available in the country. So, no need to be panicked, they said and added that with such a healthy stock and huge sugarcane crop, there will be sufficient sugar in the country. They pointed finger toward speculators trying to hike sugar prices.
On the other hand, Pakistan Sugar Mills Association (PSMA) claimed that rumours are being spread by speculators having vested interests linked with price hike of sugar. The spokesman said that the ex-mill sugar prices have not exceeded the government’s declared limit of Rs140 per kg set by the Economic Coordination Committee (ECC) meeting on June 13, 2024 although which was way below cost of production of sugar. Notwithstanding the benchmark of maintaining ex-mill price of Rs140 per kg, as a pre-condition for allowing exports of surplus sugar, was agreed by sugar industry under duress of sugar glut, for liquidating surplus stocks and for minimising losses.
Meanwhile, Federal Ministry of Industries echoed similar views regarding sugar sector of the country. Minister for Industries and Production, Rana Tanveer Hussain, assured that there has been no rise across the country. He confirmed that there is no shortage of sugar in the market and that its price remains stable. The minister stated that sugar is currently available at Rs130 per kilogram in retail markets and between Rs124 to Rs125 in wholesale markets. Federal Minister further emphasised that, under the directives of Prime Minister Shehbaz Sharif, sugar prices are being closely monitored to ensure affordability for the public. He reaffirmed the government’s commitment to taking all necessary measures to maintain price stability and prevent any unwarranted fluctuations in the market.
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Source : The News
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