PSMA eyes ex-mill sugar price at Rs95/kg

LAHORE: Sugar millers are mulling to jack up prices of sweetener to counter higher cost of sugarcane, an industry official said on Thursday.

Pakistan Sugar Mills Association (PSMA) has eyed high price of commodity at Rs95/kg, citing enhanced cost of sugarcane.

“According to the current price of sugarcane, the cost of production of sugar has reached approximately Rs95 per kilogramme,” PSMA recently told Punjab Chief Secretary.

The price of sugarcane has crossed Rs300/40kg in many part of the country.

A spokesman of PSMA said the millers and provincial Punjab government “agreed to move forward with mutual cooperation”.

“It was also agreed that the government will look into the problems of the sugar industry and won’t take any decision which will eventually bring harm to consumers.”

The PSMA spokesman said that during the meeting, the sugar industry briefed the chief secretary that sugar mills are getting sugarcane on higher rates.

“Sugar mills are purchasing the sugarcane at the rate of Rs.260-280/40 kilogramme which is much higher than the government fixed price of Rs.225. “

The spokesman said the price of sugarcane has crossed Rs300 in those areas where middle-men have become active.

“In this scenario and according to the current price of sugarcane, the cost of production of sugar has reached approximately Rs.95/kilogramme,” he added.

However it was also decided during the meeting that the ex-mill rates of sugar should not exceed Rs90/kilogramme.

Sugar industry delegation had also held separate meetings with federal and provincial governments. During those meetings, the two sides agreed that the federal government will not fix the price of sugar instead let it to be decided on demand and supply mechanism. But if sugarcane will become expensive then it will ultimately increase the cost of production of sugar.

“The government institutions should talk on sugar keeping in view of all facts, production expenditures and other concerned matters.”

The spokesman went on to say that sugarcane, sugar mills and other information, which should be legally given to Punjab Cane Commissioner, have regularly been given to the cane commissioner on daily basis.

The government had tapped international market for sugar, floated a number of import tenders earlier this year to meet a shortage and cool local prices as production fell below consumption levels.

However after import a small quantity, the government has stopped importing more sugar as existing local stocks are sufficient to meet domestic demand till the starting of new crushing season.