Pakistan : Sugar glut threatens crushing season, warns PSMA
Pakistan’s sugar mills seek immediate permission to export at least 1 million tonnes, warning surplus stocks could delay 2026-27 crushing. PSMA estimates 1.25 million tonnes surplus by November 15, while current export approvals total only 308,000 tonnes.
LAHORE: The Pakistan Sugar Mills Association (PSMA) has demanded immediate permission to export at least one million tonnes of sugar, warning that the government’s failure to clear the surplus could force mills to delay the start of the 2026-27 crushing season.
Addressing a press conference, PSMA Chairman Zaka Ashraf said on Wednesday that sugar mills could pay cane growers international prices if the government fully deregulated the sugar sector.
Responding to a question about whether mills were prepared to share additional revenue from sugar exports with growers, he said such a mechanism could be possible under complete deregulation.
He also cautioned that mills might delay crushing if the government did not allow exports of the surplus stocks.
Millers demand permission for 1m tonnes export
The PSMA chairman said that the country had produced about 7.7 million tonnes of sugar in the 2025-26 crushing season, in addition to a carryover stock of 271,000 tonnes.
This put the total available sugar at nearly 8 million tonnes. With domestic consumption estimated at about 560,000 tonnes a month, the association projects a surplus of around 1.25 million tonnes by Nov 15, after meeting domestic requirements.
The association said the government had so far permitted export of 108,000 tonnes of previously imported sugar and 200,000 tonnes from domestic production, but termed the allocation insufficient.
Mr Ashraf urged the government to immediately allow exports of at least 1m tonnes, arguing that the move would help dispose of surplus stocks, protect the sugar industry and generate foreign exchange.
He said the sugar industry was the country’s second-largest agro-based industry after textiles and claimed it generated more than Rs1 trillion in annual direct and indirect business activity across agriculture, transport, allied industries and wholesale and retail markets. He added that the sector contributed around Rs300bn in direct and indirect taxes to federal, provincial and local governments.
Mr Ashraf said the industry remained one of the most heavily regulated sectors despite repeated government assurances about deregulation.
According to the PSMA, around 70pc of sugar production used by commercial and industrial consumers was deregulated, while sugar meant for domestic consumption remained subject to government controls, including provincial determination of ex-mill prices, payment schedules and penalties.
The association argued that this partial deregulation was creating distortions and called for sugar prices to be deregulated in the same manner as sugarcane prices, along with allowing both imports and exports.
Mr Ashraf said the industry could produce up to 15m tonnes of sugar annually during a 150-day crushing season without additional investment or expansion. He claimed that as much as 8m tonnes could potentially be exported, generating around $4bn annually, while ethanol exports could bring another $1bn.
He identified Central Asian states, Afghanistan and China as potential markets for Pakistani white sugar, saying Pakistan’s geographical proximity could provide a transportation advantage over competing suppliers.
The PSMA also highlighted the industry’s use of bagasse to meet its energy requirements and noted that surplus electricity generated by mills had created opportunities to supply power to other industrial users.
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Source : Dawn
