Sugar millers urge govt to allow exports amid high global prices

LAHORE: Pakistan Sugar Mills Association (PSMA) (Punjab Zone) said on Monday that the country should seize the opportunity to export surplus sugar and earn nearly $400 million in foreign exchange as global prices are currently around $750 per tonne.

The PSMA said that the country had a surplus of almost 2 million tonnes of sugar after achieving a record cane crop and sugar production of 8 million tonnes in the 2022/23 season. "The international prices of sugar are currently stand around $750 and this most feasible opportunity is awaiting a timely decision by Pakistan to export sugar and earn nearly $400 million in foreign exchange to bolster its reserves," the PSMA said in a statement.

The association said that it had repeatedly requested the government to allow exports of surplus sugar in March 2022, when international prices were also high, but the decision was delayed due to verification of stocks by the Federal Board of Revenue (FBR).

"Sugar exports were allowed in January 2023 which could only fetch around $450 per tonne," it said. "Again at that time international prices of sugar were quite high but due to inordinate delay on pretext of verification of stocks in presence of stocks authentication by a latest Track and Trace System of FBR and certification of PSMA that window of getting high sugar prices was lost."

The association said that the international sugar market was volatile and that a timely decision by the government would bring much-needed foreign exchange for the country and support the agricultural economy.

"Timely decision by government to allow export of surplus sugar at current high international prices would bring much needed foreign exchange for the country and would support the agricultural economy," the PSMA said. "Sugarcane farmers would start getting international prices like of rice, cotton and maize. It will encourage cane growers to invest more in their fields and increase yield."

The association added that if surplus sugar was regularly exported and not negatively stigmatized, it could easily generate up to $2 billion in foreign exchange without affecting other crops or compromising local needs. The PSMA said that the sugar industry was providing $5 billion worth of import substitution by producing sugar for domestic consumption.