Pakistan Agriculture News

Footprints: Sugar wars

ELDERLY share-cropper Khalil Ahmed Arain was stirring sugarcane juice with a five-foot ladle in a small village of lower Sindh district. He made sure that the slow heating process of the juice should not cross the boiling point. Extra material collected in the form of foam was separated from concentrated liquid, to cool. And when it solidified enough it was rolled into small lumps of gurh, as a final product ready for sale.

He didn’t sell his sugarcane crop to the sugar factory, for it was offering an inadequate price of Rs120/40kg against the notified price of Rs182/40kg for the 2018-19 season. Arain had a small quantum of produce and he preferred jaggery manufacturing — though it is uncommon in this part of Sindh.

Sitting on a charpoy in a thatched straw hut in fields, Arain’s bigger counterpart and my host, Umer Bughio, told me that “I have a better deal, since instead of selling my sugarcane crop to the sugar factory, I sold it to cattle traders as fodder.”

This season, Bughio and his colleagues decided to sell sugarcane as fodder in an emerging trend amongst the sugarcane producers of lower Sindh — the home of sugar mills — as they find this option somewhat more profitable than selling their produce to what they say are arrogant sugar factory owners.

The growers are not only getting payment in cash but also saving on other expenditures, ranging from the cost of harvesting/cleansing grass attached with sugarcane, to transportation and offloading at the factory’s gate.

“Selling crop for livestock and cattle is not at all a bad bargain under the existing conditions this year, when factories are unwilling to pay the due price,” remarked Bughio, adding that he was still holding harvest on around 100 acres, anticipating that millers would go for overkill when they don’t get adequate sugarcane supplies to produce sugar. “Ensuing competition amongst the millers will jack up the price.” Of the 150 acres brought under sugarcane cultivation, he sold crop from 20 acres to fodder traders.

Of the country’s 80-plus sugar factories, 38 are located in Sindh and close to 50 in Punjab. Wealthy mill owners are once again denying farmers the notified price and seeking judicial intervention — though there may be little chance of getting a favourable order.

From this month onwards, the growing season will slowly inch towards closure. Farmers will want to free up land for other crops. As sugarcane crushing draws closer millers will start paying more than the notified price. But by this time growers have already sold their major chunk of crop at a low rate to middlemen who act as millers’ agents.

“Fodder’s price remains high this year and it enables us to sell our produce,” said Bughio. “Those rearing animals and livestock herds are paying Rs140/40kg for sugarcane and it is a price millers deny.” Fodder traders are bringing their labourers to harvest crop and are transporting it from fields to their workplace for onward sale.

Sugarcane producers get payment on the basis of the weight of the crop, that is supplied after grass has been cleaned from each stick of sugarcane. This reduces the weight. Millers then make deductions, on flimsy grounds. In Sindh, sugarcane cultivation has become a tricky job.

The sugar industry has seen unnatural growth in Sindh over last few years, even though water shortages had serious implications of this water-intense crop. According to grower Nadeem Shah, the unavailability of water flows badly affected sugarcane’s health this year. “In many water-deficient areas, the sugarcane crop didn’t have the required growth,” he said. He sold his sugarcane crop from his six acres in Matiari for Rs100/40kg and for Rs80/40kg in Sujawal to Karachi-based livestock breeders.

Sugarcane is almost a year-long crop, needing plenty of water flows till it matures. In the last kharif 2018 season, Sindh faced an overall 18pc water shortage. Reduced irrigation water flows are a regular phenomenon, especially in the command areas of the Sukkur and Kotri barrages, making sugarcane cultivation increasingly unviable.

Pakistan’s sugar millers are mostly influential politicians. With their connections, they call the shots, while farmers end up hard done by. Despite billions of rupees worth of subsidies from the public exchequer to millers, the federal and provincial governments fail to get the price notification implemented. “Pakistan is producing more sugar than its consumption needs, which is around 5.2m tonnes to 5.5m tonnes, necessitating the export of surplus sweetener for which millers pressurise the government to provide subsidies,” says another grower, Mahmood Nawaz Shah.

In the 2017-18 season, confided an officer, the Sindh government paid a provincial subsidy of Rs3.25bn (Rs9.30/1kg) to sugar mills located in Sindh as export rebate; of 1.7m tonnes of Pakistani sugar’s export, 0.9m tonnes were exported from Sindh. The State Bank of Pakistan is said to have asked the Sindh government to pay its remaining share out of the federal subsidy.

“It is a classic case of the lack of governance,” asserts Mahmood. “The issue is not whether the provincial or federal government pays the subsidy, but the point is that despite this unwanted financial burden on the national kitty, farmers don’t get adequate price. What is the purpose of pumping billions of rupees subsidy into sugar industry, then?”

Mohammad Hussain Khan