Pakistani sugar mills urge immediate surplus exports to unlock $800 million revenue ahead of new harvest
Pakistan’s sugar mills face a severe liquidity crisis as one million tonnes of surplus sugar remains unsold. PSMA seeks export approval to raise $700–800 million, warning that storage costs, unpaid farmers and the upcoming 8-million-tonne crop could worsen financial pressures.
Islamabad: Sugar mills across Pakistan are facing a severe liquidity crunch as an unsold surplus of one million tonnes of sugar remains stuck in warehouses, according to a report by Pakistan Today.
The Pakistan Sugar Mills Association (PSMA) warns that without immediate permission to export the excess stock, mills will struggle to pay farmers, meet payroll, and prepare equipment ahead of the upcoming crushing season, which is just two months away.
According to the PSMA, exporting the one million tonnes of surplus sugar could inject $700 million to $800 million into the national economy at a time when global market conditions remain favorable. Although government officials acknowledged the existence of the surplus during recent meetings, federal approval for commercial exports remains stalled.
Meanwhile, holding onto the unsold inventory is compounding financial pressures on sugar producers. Mills are absorbing heavy storage costs alongside rising bank interest charges. These expenses come on top of escalating operational costs driven by higher sugarcane support prices, increased taxes, rising wages, and expensive imported processing chemicals—all while domestic sugar prices stay below the actual cost of production.
Adding to the industry’s storage dilemma is the expectation of an 8-million-tonne yield for the upcoming crop season. Mill owners caution that accommodating the new production will be virtually impossible with existing facilities already filled to capacity.
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Source : ChiniMandi
