Islamabad : May ,29,2024 : Shahbaz government has agreed in principle to allow export of surplus sugar for helping industry to avoid a possible financial crisis. The Sugar Advisory Board had threadbare discussion in its meeting held in Islamabad on Wednesday and agreed in principle to recommend to the decision-making forums like ECC and federal cabinet to grant approval for export of surplus sugar stocks to save the industry from a complete collapse. Pakistan had a bumper sugarcane crop this year and with better yield it produced 6.3 million tons sugar in 2023-24 crushing season . Since Pakistan had around one million tons sugar stocks as carryover , its total available stocks rose to around 7.5 million tons for the current sugar year. This level of stocks has created sugar glut in the market . The sugar industry is demanding of the government to allow it export of 1.5 million tons of sugar . Sources said the government agrees to the sugar industry that it has surplus stocks which ought to be exported to address its financial woes as most of the sugar industries are not in a position to pay off their seasonal debt to the lending banks , but at the same time it does not want to see sudden increase in commodity prices in the domestic market. Ex factory rates of sugar are ranging between Rs 130 and Rs135 per kg inclusive of Sales Tax @ 17 % . The retail price of the commodity is static at Rs 150 per kg for many months. The industry claims huge loss per kg and argues that only workable solution for saving the sugar industry from major loss is permission to export 1.5 million tons surplus sugar. The Pakistan Sugar Mills Association (PSMA) made a presentation to the Sugar Advisory Board in its Wednesday meeting which suggests that the millers were picking up loss of Rs 10 plus on each kg of sugar and this equation may end up at serious financial crisis for it if export of sugar is not permitted without any delay. The government may grant permission of sugar export , but it may follow a staggered approach to calculate any specific quantity for export. A final decision is likely in next two weeks.
