The Trading Corporation of Pakistan (TCP), struggling to rein in sugar prices, will aim to buy up to 100,000 tonnes of refined sugar this week, but Indian supplies won't be considered for those purchases, an official with the state-run buying agency said on Monday. TCP Chairman Masood Alam Rizvi told Reuters they might issue two tenders - each for about 45,000 to 50,000 tonnes - for immediate shipments, adding: "We will definitely be in the market some time this week."
Rizvi added that a ban on Indian sugar would remain in place." Any offer to supply Indian-origin sugar will be rejected," he added.
But Karachi traders said the government could consider Indian sugar in future tenders if global traders quote high prices.
"Much will depend on the result of the TCP's upcoming tender," said one trader adding, "If it gets a good bargain, then imports from India will remain banned. Otherwise, we can see cargoes from across the border as the government wants to stabilise prices and India is the cheapest supplier."
Seatrade Group Chief Executive Muhammad Najib Balagamwalla told Reuters on Sunday more meetings were scheduled between the traders and government officials to resolve the issue and chances of Indian sugar coming was "close to 100 percent".
Pakistan banned imports of Indian sugar in 2001, after the local industry complained that cheap Indian sugar was hurting Pakistani cane growers and processors. During the fiscal year 2000-01, Pakistani traders bought more than 800,000 tonnes of Indian sugar.
Some dealers said the quality of Indian sugar was also a consideration. "We heard Pakistan is looking for 50,000 tonnes of sugar with 100 the International Commission for Uniform Methods of Sugar Analysis (ICUMSA) level," said a dealer at an international trading house.
The ICUMSA measures the colour of sugar. The lower the ICUMSA level means a higher degree of whiteness.
MORE IMPORTS: An official at the Ministry of Production and Industries, which handles Pakistan's sugar trade, said imports could be up to 300,000 tonnes as the country needed big stocks ahead of the month of Ramazan, which fell in October.
"We will need more imports to stabilise prices before Ramazan," said the official who declined to be identified. "Our initial estimate is that we will have to import 300,000 tonnes of refined and 100,000 tonnes of raw sugar to check prices," he said.
Pakistan has been buying the commodity from international markets since January and has imported more than 500,000 tonnes of refined and raw sugar. But imports have failed to dent high domestic prices, which were around 27 to 28 rupees per kilogram in June, a little softer from a four-year high of 30 rupees per kg in February.
Rizvi said the need for more sugar imports would be assessed after completion of the first phase.