PSMA dismisses reports of low sugar stocks, urges govt to export surplus

Association spokesperson urges govt to export surplus sugar and earn forex before India, Brazil dump surplus stock in int'l market

LAHORE: The Pakistan Sugar Mills Association (PSMA) on Thursday rejected the Commerce Ministry’s statement that said that the country does not have sufficient amount of surplus sugar and that there is only 0.4 million tonnes surplus stock at present, while adding that they had a surplus amount which must be exported to earn foreign exchange.
The data available with the Ministry of Industries and Commerce Ministry had said that the country holds a surplus sugar stock of 2.0 million tonnes.
However, a PSMA spokesman said that the minutes of last meeting of the Sugar Advisory Board had proposed that 7.8 million tonnes of sugar had already been produced whereas crushing season is in progress.
“Sugar produced from sugar beet was added to this surplus stock, hence a total of 8.1 million tonnes of sugar was available by the end of previous crushing season,” he added.
Estimating the consumption at the rate of 0.5 million tonnes per month makes to a total of 6.1 million tonnes for the entire year. These figures suggest that 2.0 million tonnes of surplus sugar is available in the country.
The spokesman said that estimated figures are based on the average consumption during the current season. “They are based on the last stock available with the sugar mills whereas an ample stock is also available with stockists and retailers. The ministry’s claim of limited surplus sugar stock is not based on ground realities.”
He added that in the Sugar Advisory Board’s last meeting dated April 14, 2022, the provincial cane commissioner and relevant federal ministries had authenticated the above figures.
Furthermore, the spokesman stated that the Federal Board of Revenue (FBR) has installed a very efficient Track & Trace System through which authentic data is available to the FBR at all times.
The spokesman expressed feared that delaying tactics would push Pakistan into a 2017 like situation when the country had surplus stocks and PSMA kept asking for permission to sugar export as international prices were high but due to delayed decision making, international prices went down and an export subsidy had to be provided to meet the cost of production.
“At present, Pakistan is in need of foreign exchange and by exporting surplus sugar could bring in $1 billion. Brazil and India are also considering dumping their surplus sugar in the world market which will further bring down international prices, therefore immediate action is needed by the government of Pakistan,” the spokesperson said.
Moreover, he said an increase of at least 10-15 percent in sugarcane production is highly anticipated in the next season, taking the total surplus sugar forecast to 3 million tonnes besides the previous season’s 2 million tonnes of surplus sugar.
“If the government allows sugar export after October, the international market will be very low and our efforts would go to waste,” he stated, adding that payments will get stuck and sugar mills will be jeopardized with cash flows to pay farmers which will result in them stop sowing sugarcane crop due to which the government will have to spend millions to billions of dollars on the import of sugar.
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