Islamabad:
Prime Minister Shehbaz Sharif was a committee, led by Darrier ISHAQ DAR, to negotiate with sweets a price reduction after his previous decision to authorize the export of the goods led to a 2200% increase in his export and 19% of prices this year.
The price per kilogram of sugar reached an average of RS172 to this last Friday – RS27 per kg higher than the same week of last year, according to Pakistan Bureau of Statistics (PBS). The increase in RS1 per kg removes 2.8 billion rupees from consumers’ pocket, according to the Ministry of Food Security Working.
The Prime Minister’s office informed a committee of 10 members with the mandate to reduce the prices of sugar by engaging with Pakistan Sugar Mills Association (PSMA) – the association that works only for the protection of the interests of the Millers.
The Pakistan Competition Commission (CCP) has investigated the PSMA for its role in manipulation of prices. The Prime Minister also holds the portfolio of the Minister of Industries and sweets are now directly under his field.
The new committee will be chaired by Dar, responsible for giving its report within three days. The committee held its first meeting on Monday, according to officials. At the meeting, the government told sweets that the average sugar production price was RS153 per kg, therefore, industry should reduce prices itself.
The industry, however, sought time to consult all stakeholders before committing a new price, the officials said.
The Prime Minister set up the Committee led by the DAR after the average sugar prices jumped after sugar prices increased from RS10 in a week and RS27 compared to last year, according to the National Agency for Data Collection. He also indicated that the maximum national price has skyrocketed to Rs180 per kg in Karachi and Islamabad.
The prices were also RS27 per kg higher than the maximum RS145 threshold, which the government had determined at the time of the authorization to export 600,000 tonnes of metric sugar.
An official of the Ministry of Food told L’Express PK Press Club on Monday that RS1 per kg increase had given an additional advantage of 2.8 billion rupees to the miller. According to this chief, the thousands collected RS26 billion additional advantages in the last week and 76 billion rupees since the start of the overwhelming season.
A key reason for the increase in sugar prices was the decision of Prime Minister Shehbaz Sharif to authorize the export of sugar. The PBS published the export data on Monday, which revealed that the country had exported 757,779 metric tonnes of sugar from July to February of this exercise.
Compared to last year, when only 33,101 tonnes of sugar were exported, there was a 2190% increase in export during this financial year, data showed. In terms of value, exporters won $ 407 million during the July-February period, which was also $ 386 million or 1,831% higher than the previous year, according to PBS data.
According to the notification of the Prime Minister, the Committee will engage with the PSMA to negotiate a reduction in the price of ex-exhibition sugar, aimed at stabilizing market prices, in particular in response to the sharp increase observed during Ramazan.
The Committee included the Minister of Food Security Rana Tanveer Hussain, the minister of Law Azam Nazeer Tarar, adviser to Prime Minister Dr Tauqir Shah, special assistant to Prime Minister Tariq Bajwa and four PSMA representatives. The industry secretary provided the support secretariat.
The government has not officially included a special assistant to the Prime Minister of Haroon Akhtar Khan industries on the committee. Shehbaz asked the committee to conclude its deliberations and submit a compliance report within three days, confirming that the question of the rise in sugar prices had been effectively resolved.
Iskandar Khan, chapter of the Khyber-Pakhtunkhwa (KP) chapter of the PSMA, said prices increased due to the increase in sugar cane prices during the crushing season. He added that the average price of sugar cane remained RS455 by 40 kg, which pushed the cost of production to Rs174 per kg. Khan said raw sugar imported would also cost RS190 per kg after refining it.
On September 20, the ECC granted an export of 100,000 metric tonnes of sugar, which was increased to 600,000 in October of last year. The Express PK Press Club had reported in October that the government had authorized the export of an additional 500,000 tonnes of additional sugar on the basis of massively handled figures for stocks and available consumption models.
The PSMA denies, however, that prices have skyrocketed due to exports. Its spokesperson for the Punjab zone said that industry had agreed that ex-moulin sugar prices would remain capped at Rs140 per kg during the export period, which was lower than its production cost.
However, due to enormous excess actions, the prices of the ex-daughters remained between RS120 to Rs.125 per kg, well below this reference, continuously for several months, he added. Almost 50% of the total sugar available has been sold a lot below its production cost, causing massive losses to industry, he added.
The PSMA spokesperson said the price mechanism depended on market forces. He blamed prices increase to holes and profiteers who have spread rumors to influence market forces to obtain industrial profits on sugar available with them.
The PSMA spokesperson said that no white sugar import was necessary, because national actions were sufficient to meet domestic needs until the next crushing season. But he added that the PSMA approved the importation of raw sugar by a policy of politics and had submitted its proposals to a ministerial committee constituted by the government.
