Sugar millers call on government to permit exports amidst soaring global prices
Published on: December 1, 2023.
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Pakistan Sugar Mills Association (PSMA) (Punjab Zone) has urged the Pakistan government to take advantage of the current global prices of sugar, which are around $750 per tonne, and export surplus sugar to earn approximately $400 million in foreign exchange. The country currently has a surplus of nearly 2 million tonnes of sugar after a successful cane crop and record sugar production of 8 million tonnes in the 2022/23 season. The PSMA emphasized that exporting sugar at the current high international prices would not only bolster the country’s reserves but also support the agricultural economy.
The PSMA has been requesting the government to allow sugar exports since March 2022, when international prices of sugar were also high. However, the decision was delayed due to the verification of stocks by the Federal Board of Revenue (FBR). Although sugar exports were eventually allowed in January 2023, the prices fetched were around $450 per tonne, and the opportunity to benefit from the higher prices was missed because of the delay caused by stock verification.
The association emphasized that the international sugar market is volatile, and a timely decision by the government is crucial to capitalize on the current high prices. Allowing the export of surplus sugar at these prices would not only bring much-needed foreign exchange for the country but also encourage sugarcane farmers to invest more in their fields and increase yield. The PSMA highlighted that if surplus sugar is regularly exported without any negative stigma, it has the potential to generate up to $2 billion in foreign exchange without compromising local needs or affecting other crops. The sugar industry in Pakistan already contributes $5 billion worth of import substitution by producing sugar for domestic consumption.
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