PSMA says prices have not exceeded govt limits

A spokesperson for the Pakistan Sugar Mills Association (Punjab Zone) (PSMA) stated that ex-mill sugar prices have not exceeded the government’s declared limit of Rs140 per kg. This was confirmed in the Cabinet Committee on Monitoring of Sugar Export meeting held on August 1, 2024, and endorsed by the Ministry of Industries and Production after confirmation from provincial governments. All sugar mills have fully complied with the commitment given by the PSMA before the final approval of the government on the export of 0.15 million tonnes of sugar.

It should be noted that the net impact of the withholding income tax under section 236G of Income Tax Ordinance 2001, recently enhanced in the budget by the federal government to Rs2.52 per kg, needs to be added to the ex-mill price benchmark, said the spokesperson.

They highlighted that despite suffering huge losses in the billions due to increased production costs and the expense of maintaining surplus stocks, the sugar industry is striving to meet the expectations of the government, local consumers, and sugarcane farmers. However, the ongoing and significant losses are becoming increasingly unmanageable for the industry.

The association reiterates its request to the government to allow the early export of 1.5 million metric tonnes of surplus sugar, as only 60 to 90 days remain before the next crushing season begins. Clearing surplus stocks is in the national interest to make space for the new season’s production. Any delay will harm both the industry and farmers, in addition to depriving the country of much-needed foreign exchange. A timely decision will enable the sugar industry to meet local demand and contribute to the country’s agricultural and national economy by exporting the surplus.