Cane-sugar price linkage: body set up to suggest remedy

26 Oct, 2004

A high level committee has been constituted to look into the linkage of sugarcane price with sugar price.
The committee would be headed by Jehangir Khan Tareen and include representatives of Pakistan Sugar Mills Association (PSMA) as members.
The committee would have a deep look into the issue and try to find a solution of that controversy on permanent basis, an official source told the Business Recorder here.
The first meeting of the committee is likely to be held some time this week, which may come out with a formula to cool down tempers that are running high over price issue at this point of time.
It may be recalled that an inter-ministerial committee of the Federal government had met the PSMA representatives on October 19 in a bid to resolve the continuously conflicting issues related to the start-up of sugarcane crushing from November 1 in Punjab and Sindh and sugarcane vis-à-vis sugar price.
Creating a sort of linkage in prices of raw material being sugarcane and end product, sugar is being considered a remedy to resolve it on permanent footing.
The government may, to make linkage an economic viability, reconsider sugar price and create mechanism for sustaining it unblemished.
Sugarcane crushing season in the improving scenario seems poised to be on line from the beginning of November both in Sindh and Punjab, as the government has earlier desired the Federal government can resolve the sugarcane price preferably before the end of the current month.
However, an uneasy calm prevails in Sindh as sugarcane's minimum price at Rs 43 per 40 kilograms is termed as uneconomical by the Sindh sugar industry.
The industry had been agitating for its reduction to Rs 41 per 40 kilograms, so as to maintain parity in sugarcane price and provide Sindh segment a level playing field.
The sugarcane price in Sindh is likely to be reconsidered at the Sindh provincial government level to overcome the uneasy situation and Sindh sugar industry begins crushing by beginning of November.

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