ISLAMABAD: Sugar millers across the country have decided not to start cane crushing, alleging ‘dictated cane price which offers no clarity about the rate mills will be able to charge for the final sugar product’.
In a press conference on Tuesday, Pakistan Sugar Mills Association (PSMA) Chairman Aslam Farooque alleged that the sugar industry was regulated and the government was mounting pressure on mills to start the new crushing season. Millers across the country have unanimously decided that they will not begin crushing.
Millers will sustain Rs15 per kg loss on production of sugar due to a disparity in sugarcane and sugar prices, he said. He explained that the high minimum support price of Rs180 set for sugarcane for the last four years had motivated growers to plant more sugarcane which led to the production of bumper crops and surplus produce, eventually leading to depressed local sugar prices.
He claimed that a daily loss of Rs6-25 million was being incurred depending on the capacity of the mill, with the larger ones losing more money.
“When fixing cane prices, successive governments repeatedly overlooked policies they set on the final product – sugar,” he said.
The PSMA, for the past couple of years, has repeatedly asked the government to allow timely exports to reduce surplus sugar stocks, stablise local market prices and also earn foreign exchange for the country. However, governments have been consistently dragging their feet in allowing timely exports and thereby unduly depressing local prices of sugar to levels which are now untenable.
Mr Farooque pointed out that ever since the new federal and provincial governments have taken charge, PSMA has been making all out efforts to get their attention for a workable solution to the industry’s problems and to a resolution of the past dues of the industry – a major one, he claimed, being the Rs14 billion owed to the mills that exported sugar and made payments of about Rs300bn in sugarcane liabilities paid to growers. The same was also validated by a suo moto notice taken by the Supreme Court, he added.
Sadly, despite many meetings, not a single issue has been resolved and no positive direction has been taken by either the federal or provincial governments, he said.