The sugar industry has foiled the Trading Corporation of Pakistan (TCP) bid to sell its stocks in the market in bulk at Rs 34 per kg by cutting down its stocks prices to as low as Rs 33.
After the secretaries' committee approval, TCP had floated tenders and fixed the deadline of August 26, 2006 for the parties to show interest to buy its stocks in bulk at Rs 34, but its entire exercise proved futile as not a single party came in with a positive response.
The buyers would naturally prefer the mills to TCP if they offer the stocks at lower rates. They also prefer the mills to TCP due to their hassle-free and simple procedure for sugar sale.
Sources said after getting poor response from the buyers for bulk sale, TCP has approached the federal government to get the new guidelines for the future tendering.
They said TCP had conveyed to the secretaries committee in writing that rate of Rs 34 per kg was making it difficult for them to sell the stocks, and suggested to rationalise the rates to attract the buyers in future tenders. TCP authorities are of the view that difference of at least Rs 3 per kg against rates offered by mills can help them release stocks in the market in bulk.
As on August 31, TCP had 585000 tonnes sugar in its stocks. The stocks will surge with the coming of more vessels by the end of the current month. TCP has informed the government umpteen times that it was facing storage problem due to continuous increase in its stocks, and has suggested to allow it offer the buffer stock in the open market in small lots. The fate of the proposal is yet to the decided.