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Business

August 12, 2017

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Sugar prices keep mounting as millers push govt for subsidy

Sugar prices keep mounting as millers push govt for subsidy

LAHORE: With sugar stocks at their lowest in the main wholesale market after an unprecedented increase of Rs14/kg in about 13 days, the ex-mill price of sugar jumped to Rs60-61/kg on Thursday. The price showed no improvement as powerful mill owners continued squeezing supplies in an attempt to keep the price of the commodity hiked.

According to the official price list, the wholesale price of sugar has touched the mark of Rs58-59/kg in some central and northern districts of the province. As per market survey, retail prices, however hover around Rs62-65/kg in cities, including the provincial metropolis.

After failing to strike a deal with government over export subsidy, the sugar mill owners have started sharply increasing ex-mill price, leading to slow lifting of commodity by the dealers.

There has been daily increase of about Re1/kg increase in ex-mill price during the last nearly two weeks.

Sugar prices have been arbitrarily jacked up by millers in a very short span of time, which is unprecedented in the history of the country, Asghar Butt, president, Lahore Sugar Dealers said. While squarely blaming powerful sugar mill owners for this mess, he asked the government to ensure smooth supply of the commodity in order to curb its prices.

The ex-mill price of sugar was Rs47.50/kg on July 30th, he said, and added that now with artificial shortage of sugar, its price was hovering around Rs58-59 a kg, which was totally unjustified.

He warned that sugar stock of Akberi Market was about to end, and following exhaust of retail market stocks in the next about 10 or 15 days, the consumers might face a much bigger crisis on the eve of Eid.

Chauhdry Waheed, veteran member of Pakistan Sugar Mills Association blamed the government for all ills of the sugar sector, and said the commitments made with millers were not fulfilled by the state despite repeated assurances. The ministry concerned has failed to issue notification about export subsidy, he observed.

He claimed that there was no short supply of sugar in the country, and said any dealer could buy sugar tomorrow morning at Rs60/kg. Referring to sharp increase in sugar price, he asserted that mill owners should not be blamed for price hike.

“No one can force us to sell sugar at loss,” he maintained.

However, he hastened to add that mill owners should not be blamed for influencing price or supply of the commodity. “The cost of sugar is much higher than the prevalent prices as we have already made hefty payments to growers.”

He also asked the federal government to give Rs12/kg subsidy to millers on the export of the commodity. Otherwise, he said, the sugarcane crushing season would not start by October this year.

He stressed the need of prudent handling of affairs by the government “as all responsibility in this regard lies with it”.

Otherwise, the PSMA member said the present crisis-like situation would continue.

He made it clear that the country has surplus stock of about 1.5 million tons which was sufficient for meeting the demand till February 2018.

PSMA central chairman Javed Kayani did not respond to queries sent to him about the sugar crisis.

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