Controlled sugar exports on the table after millers’ intense lobbying

LAHORE: The government is set to greenlight a controlled sugar export strategy after intense lobbying by influential sugar mill owners, with a post-Eid meeting scheduled to address the matter, sources said on Saturday.

The government’s tentative strategy involves an initial export of 250,000 metric tonnes of sugar, a figure that falls short of the Pakistan Sugar Mills Association’s (PSMA) ambitious push for exporting one million metric tonnes.

"The government is considering allowing 250,000 metric tonnes of sugar in the first phase against the demand of the Pakistan Sugar Mills Association of allowing one million metric tonnes of sugar exports," an official in the provincial food depertement told The News.

The PSMA, in a recent letter to the Minister of Finance and the Minister of Commerce, mentioned that ‘the total available sugar in the current year is 7.5 million metric tonnes, while the country's annual consumption is 6 million metric tonnes, which shows that Pakistan has a surplus of 1.5 million metric tonnes of sugar, which can earn $1.2 billion in foreign exchange.’

According to the official data of the provincial cane commissioners of Punjab, Sindh, and KP, the total sugar produced in the country during the crushing season 2023-24 is 6.752 million metric tonnes, while 0.823 million metric tonnes were carried over stock from the previous crushing season of 2022-23. The total available stock was 7.575 million metric tonnes.

The sugar mills had dispatched/sold 2.572 million metric tonnes of sugar till March 31, 2024, from November 25, 2023. The current balance of sugar available in the country stands at 5.003 million metric tonnes.

The average monthly domestic intake of sugar is 0.572 million metric tonnes. Thus, the available sugar stocks are sufficient for the next 8 months till December 2024.

Historically, the sugarcane crushing season starts in the third week of November every year. The country will have almost equal to the last crushing season level carried over stock of less than one million tonnes, or precisely around 0.8-0.9 million metric tonnes.

"This is against the claims of the sugar mills association of 1.5 million metric tonnes of surplus sugar available in the country," the official said.

The government official said that the government will carefully review the sugar stock positions in the country before allowing the export of it.

"The Indian government has completely banned the exports of food items, anticipating shortages. Thus, any decision of exporting sugar or any other food items will be made according to the domestic needs and availability of sufficient surplus stocks after maintaining the strategic reserves."

Recently, the government has imposed a ban on the exports of onions and bananas until April 15 to control the prices in the domestic markets. "Thus, the government will not take any decision in haste for the export of sugar too," the official added.