A market expert said, "In the prevailing situation, hardly anything can work to check soaring trend in sugar rates". The expert termed rising trend in sugar rates during peak crushing season as alarming. He was of the view that the market sentiments were a cause of speculations of high prices during off-season.
He said, "The soaring trend in sugar market during peak production season (November-March) gives a strong indication that the prices will go up once the crushing season comes to an end."
The government had allowed import of 0.250 million tonnes raw sugar to control rates in the domestic market but the move apparently did not work to check overall market sentiments.
The market analysts say that the government move of importing raw sugar was a bad decision, adding that rather it should have disposed of Trading Corporation of Pakistan's (TCP) stocks in the first place, allowing either TCP or any other public sector organisation to import duty-free refined sugar to curb speculations.
The TCP has 0.378 million tonnes sugar stocks in hand, it roughly costs Rs 20 per kg. The analysts are unable to understand the logic behind the government's move for import of raw sugar when the TCP stocks were available for release to the retail market. They say that the import of refined sugar could be the right step to check upward trend in the prices.
Now when rates are too high, imported refined sugar will cost less. According to the experts, C&F price of sugar at Karachi will cost roughly Rs 23 and after transportation and other charges it will be available for the retailer at Rs 25 a kg.