Sugar production has reached close to three million tons and the total production has been estimated at 3.6 million tons at the close of the current sugarcane crushing season, sources in the ministry of industries told Business Recorder on Wednesday.
Sources said total sugar production was recorded at a little over or close to three million tons upto March 31, this year, compared to 2.5 million tons produced in the same period last year. "There is an increase in the sugar production and it could safely be estimated that total sugar production could be around 3.6 million tons this year," they added.
The sources said there was enough sugar stock available with the Trading Corporation of Pakistan (TCP) and there would be no sugar crisis this year. The total sugar consumption is a little over four million tons while the TCP has more than 0.6 million tons as carry forward stock, the sources said. They added that seeking intervention of President Pervez Musharraf in the sugar issue by the Pakistan Sugar Mills Association (PSMA) could only be an attempt to create artificial crisis, they added.
The PSMA, on the other hand, is of the view that the government budged from its stance. The PSMA is of the view that the Federal Secretaries Committee on Sugar along the Agriculture Prices Commission (APCOM), which is now Agriculture Prices Institute (API), had fixed ex-factory sugar price at Rs 31 per kg. This had been calculated keeping in view the overall increase of 33 percent in minimum support price of sugarcane and minimum wages announced by the government.
The sugar prices could not cross the figure of Rs 28 per kg and almost hit the rock-bottom after two tenders of 25,000 MT quantities each, by the TCP in violation of the agreement between PSMA and the Secretaries Committee destroyed the total market sentiment, accuses the PSMA. However, the government totally denies that it had reached such an agreement with the sugar mills.
Sources said intervention prices for sugarcane were Rs 60 per 40 kg in Punjab, Rs 65 in NWFP and Rs 67 per 40 kg in Sindh. These prices had actually benefited the sugar mills situated in Rahim Yar Khan, an area - generally known as cotton growing belt. The sucrose recovery was recorded at 10 to 11 percent- the highest in the country- in Rahim Yar Khan, where most sugar mills belong to some senior members of the cabinet. The recovery in Sindh was recorded at around 9 percent and in the NWFP at around 7.5 percent.
A recent comprehensive study revealed that more than 65 percent farmers have decreased the total area under cane production due to water shortage, behaviour of the mills' management, late payments, increased inputs cost, and diseases and rodent attack.
Constraints faced by the growers are under weighing of cane at purchase centres and mill gates, undue deductions by mills up to 10 per cent, delays in payments, middleman, obtaining an indent, and the payment of premium.
The price structure is such that out of the sale price some 35 percent of the cost goes to farmer and 24 percent to the government in taxes and duties, 21 per cent to mills with nine and six percent to wholesalers and retailers respectively.