Prime Minister Nawaz Sharif has directed the mill owners to pay Rs 180/40 kg price of sugarcane to growers and he required they comply with his directions.
Addressing a gathering on the occasion of inaugurating of Khanewal-Multan Section of Faisalabad-Multan Motorway project on Saturday, the prime minister has directed his staff and sugarcane growers that price of sugarcane should be fixed at Rs 180/40kg this year. He also directed his officers on the spot to talk in this connection with all the provinces.
The Sindh government had already withdrawn its subsidy being paid to the sugarcane growers last year and told the sugarcane growers and the mill owners to set sugarcane price at Rs 180-185/40kg in Sindh.
An official of the Sindh government informed that the Sindh chief minister had totally refused to give subsidy to sugarcane growers this year as the Sindh government was paying this subsidy from development fund of Sindh.
The sources in sugar industry informed Pakistan Today that three small sugar mills had started purchasing sugarcane at Rs 160-165 for crushing in Sindh province.
Chairman All Pakistan Sugar Mills Association (APMSA) Iskender Khan said: “The federal government should also set the ex-factory and retail price of sugar, if it wants to start crushing.” He said the mills owners paid 80 percent of the cost of sugar to growers, while 8.5 percent excise duty and 1.5 percent coupled with cane rates results in fixing of 90 percent cost of sugar mills. He said the remaining 10 percent is left to the factory to pay for salaries, working capital interest rate, repair and maintenance cost, whereas sugar prices are left on market forces.
Therefore, the chairman strongly believed that either GoP shouldn’t fix the cane price or alternatively it should also fix sugar price. Furthermore, sugarcane price is based on the weight but not on its juice or quality which would be an unfair treatment with farmers and sugar mills.
The sugar mills owners, throughout the country, were demanding that the government should fix the cane rates at Rs 160-165 otherwise they would not start crushing of the sugarcane.