LAHORE: The price of white refined sugar has now reached the psychological barrier of Rs 100 per kilogram in wholesale markets on Saturday. The latest pricelists shows that the sweetener is now selling at Rs 5,050 per 50-kilogram bag in the largest wholesale market of the province, Akbari Market.
Pricelists show that the price of white sugar has been sharply raised by Rs 11 per kilogram in the last five days as the sweetener was selling at Rs 90-92 per kilogram on November 2, 2010, while it was available at Rs 101 per kilogram in wholesale on Saturday.
Data shows that due to absence of any meaningful price control, the price of sugar has registered an alarming rise of Rs 26 per kilogram since October 1, 2010, which is equivalent to an increase of over 35 percent in a single month. Sugar dealers allege that millers are engaged in price manipulation for at least one month and have pushed up the sugar price, adding one or two rupees nearly every day.
However, Pakistan Sugar Mills Association (PSMA) Chairman Javed Kayani claims that the price of sweetener was escalating because the government did not intervene promptly by offloading sugar from Trading Corporation of Pakistan’s (TCP) stocks. He argues that sugar mills have informed the government that there is a pressing shortage of around 1.2 million tonnes of sugar in the country.
The sweetener is likely to disappear in the open market in November, once sugar mills’ stocks finish, he added. Despite the vocal protests of the PSMA, official figures of the provincial government illustrate a different scenario. Figures indicate that sugar mills hold over 151,000 tonnes in sugar stocks as of October 27, 2010.
Data shows that Hunza Sugar Mill had the largest sugar stocks of 16,838 tonnes on October 31, 2010, followed by PSMA Chairman’s Channar Sugar Mill 15,113 tonnes, Pattoki Sugar Mill 11,898 tonnes, Abdulah Sugar Mill 11,626 tonnes, Layyah Sugar Mill 10,297 tonnes, Rahim Yar Khan Sugar Mill 9,210 tonnes, Kamalia Sugar Mill 8,476 tonnes, Hamza Sugar Mill 8,204 tonnes, Colony Sugar Mill 7,092 tonnes, Haseeb Waqas Sugar Mill 6,887 tonnes, Huda (Fauji) Sugar Mill 5,153 tonnes, Haq Bahu Sugar Mill 4,939 tonnes, Ashraf Sugar Mill 4,835 tonnes, Brothers Sugar Mill 4,581 tonnes, Abdulah Sugar Mill 4,366 tonnes, Indus Sugar Mill 4,052 tonnes, JDW Sugar Mill 3,433 tonnes, Ittefaq Sugar Mill 2,803 tonnes, Kashmir Sugar Mill 2,690 tonnes, Chaudhari Sugar Mill 2,329 tonnes. In addition, stock figures also clarify that there are another 20 mills, which had sugar stocks between 21 and 774 tonnes each.
On a related note, in a press statement, on Tuesday, Federal Minister for Food and Agriculture Nazar Mohammad Gondal expressed his belief that there is no need to import sugar, as sufficient quantities are available in the country. In the recent Sugar Advisory Board (SAB) meeting, it was disclosed that the sugar presently imported and domestic stocks combined, stood at approximately 500,000 tonnes, which were sufficient till the end of November. 300,000 tonnes of sugar are to be imported by the end of November with an extra 100,000 tonnes brought by December.
After deliberation in the meeting, it was decided that the TCP would start disburse 50,000 tonnes of sugar every ten days in the open market through tenders. The plan entails that a total quantity of 250,000 tonnes be offloaded by middle of December. The remaining 400,000 tonnes would be held as a strategic reserve and for distribution to the Utility Stores Corporation.
Experts estimate that the country has over 800,000 tonnes of sugar stocks available, including 650,000 tonnes of TCP, 150,000 tonnes of the sugar mills and some 50,000 to 75,000 tonnes held by sugar dealers. They question the government’s curious unwillingness to intervene at a time when the country, particularly the government, seems to hold sufficient sugar stocks to avert the impending sugar crisis.
Agri Forum Pakistan Chairman Ibrahim Mughal believes that issue at hand is of a regulatory and administrative nature, rather than one of supply deficiency. He said the TCP had imported sugar at Rs 80 per kilogram and had sufficient sugar stocks to meet at domestic requirements for at least four months. If it began market intervention price of the sweetener could easily bring down to Rs 80 per kilogram, but he added, that the government was apparently nonchalant about the price of sugar.
Responding to a query, he expressed his belief that the TCP was among the most corrupt organisations in the country, alleging bribery in both sugar purchase and sale processes. He said both the government machinery and sugar millers were engaged in a massive exercise of profiteering at the expense of the masses. Mughal railed that the common farmer is caught in a vice-like grip by the powerful sugar millers. He argued that if the government managed to start crushing season in accordance to the Punjab Cane Act, sugar price could not exceed Rs 80 per kilogram.
He said that if the crushing began promptly, there could be a surplus of sugar in the market allowing the stabilisation of the price of the much-sought commodity.
