Sugar mills begin production

New stock likely to help bring down sugar prices and tame inflation in the country

A number of sugar mills have started production of the sweetener for the new season 2020-21 well on time this year. The new stock is expected to curb the price of the commodity and tame the inflation in Pakistan.

“More than 20 sugar mills have started crushing sugarcane in the past one week or 10 days in Sindh…out of total 30-31 mills in the province,” Sindh Abadgar Board (SAB) Vice President Syed Mahmood Nawaz Shah said while talking to The Express Tribune.

An office bearer of the Pakistan Sugar Mills Association (PSMA) said the mills, including the ones in Punjab, have stared production of sweetener well on time this year. There are over 40 mills in Punjab and around 8-10 in Khyber-Pakhtunkhwa (K-P).

The two stakeholders projected sugar production to be 5-10% higher than 5.2 million tons attained last year (2019-20). “The new production should reduce the price to at least Rs75-80 per kg in retail compared to over Rs100 at present,” Shah said.

To recall, sugar was available at Rs54 per kg in retail when the Pakistan Tehreek-e-Insaf (PTI) government came into power in the July 2018 general elections. The government conducted forensic audit of sugar mills to investigate causes for the significant surge in the commodity price to over Rs80 per kg in May 2020. The price, however, continued its uptrend and reached Rs110 per kg.

It remained unknown as to how many factories have started production in Punjab and K-P.

Shah, however, expressed sorrow over the Sindh government’s delay in notifying date for start of sugarcane crushing season and support price (minimum purchasing price) for the cane.

“All the sugar mills in Sindh are bound to start crushing maximum by November 30 as per the law in place…whether the government notifies the start of production season or not,” he said.

The Punjab government notified late last month the cane support price of Rs200 per 40kg and start of sugar manufacturing season in between November 10-15.

“We have proposed sugarcane support price at Rs225 per 40kg,” Shah said, adding that growers are selling cane at a price ranging between Rs200-235 per 40kg these days.

The Federal Committee Agriculture (FCA) reported late last month that growers have cultivated sugarcane at larger area this year compared to the last year.

The FCA was informed that the area under sugarcane cultivation in Punjab increased 20.68% compared to last year while sugarcane area in Sindh increased 0.96% whereas the area in K-P decreased 0.8%. The overall sugarcane area under cultivation increased by 3.37% this year compared to the previous year.

Similarly, sugarcane production increased by 21.18% in Punjab, 0.53% in Sindh, 0.14% in K-P and 9.54% in Balochistan, the meeting was informed.

Pakistan produced around 60 million tons sugarcane last year, it was learnt.

Shah said owners of sugar mills located in Sindh have expressed hope for an increase of 10-12% in sugar production this year. He said the sugarcane production may remain the same in the province considering the heavy rainfall and flooding in many parts of Sindh.

The government has declared eight districts as disaster hit areas. The production of cane in the disaster-hit areas has remained critically low.

On the contrary, the cane production in Punjab should come higher considering timely rainfall, favourable weather and availability of sufficient water for the crop, he said.

Published in The Express Tribune, November 15^th, 2020.

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