Pakistan Sugar Mills Association (PSMA) has reportedly refused to export sugar without subsidy and held Commerce Ministry responsible for the current chaos which used delaying tactics for export permission. This was the crux of PSMA's all zone's emergent meeting held under the chairmanship of its Chairman Javed Kayani to review the stocks of sugar after the current crushing season.

The meeting observed that Punjab has so far produced 4.266 million tons, Sindh 2.1 million tons and KPK 0.440 tons totalling 6.806 million tons - a record production in the country. PSMA at the beginning of the season requested for permission to export 0.5 million tons of sugar but Commerce Ministry kept on 'doing politics' on sugar and only supported permission to export 0.2 million tons while at that time price of sugar in the international market was around $540 per ton and the industry could easily export the entire surplus quantity.

However, now the market has come down by $100 per ton to $443 per ton. As the trade deficit has woefully widened, the sugar industry could significantly contribute to earn much needed foreign exchange to help the country reduce trade deficit. According to Chairman PSMA, there is still about Rs 25-30 billion of the growers outstanding which will remain unpaid because of "pragmatic" policies of the Commerce Minister. "Now how will the industry pay growers when it is not able to recover the cost of sugarcane at the current export price level," said Chairman PSMA.

PSMA members from all over Pakistan have given the mandate to Chairman to take up the issue at the highest level and highlight the ruinous attitude of the Commerce Ministry with respect to the industry and the interests of growers despite clear forecast and projections given by the industry and duly accepted by Sugar Advisory Board (SAB).

According to the Association, the situation is really grim and the local sugar price has come down to a level where after paying 6 rupees sales tax it is impossible to recover the cost of manufacturing sugar due to overhead manufacturing and financial charges and meet the provincial government's directives to clear payments of growers while threatening to auction the mills.

"Commerce ministry is to blame for all this chaos as their defective decision making has rendered the growers helpless," he said, adding that the Commerce Minister will only realise when growers will block the roads and create hue and cry asking for their payments. It will be impossible to export without subsidy and commerce is to blame for all this, the PSMA contends.

Copyright Business Recorder, 2017