While painting a bleak picture of the industry, the Pakistan Sugar Mills Association (PSMA) on Tuesday conveyed to the government in clear terms that it is not going to start crushing season 2007-08 before January 2008.
"It's very serious issue that sugar industry is being ruined and we damn care what kind of fallout the government faces as a result of delay in start of crushing season," said PSMA vice chairman Sikander Khan.
He said PSMA was very open and clear to the official team, headed by Food secretary, for talks that sugar industry would not come to government's help, if existing policy hitting it hard through low sugar prices continued for next few months.
Sikander said his group never defaulted on payments to the growers, but the government created crisis put his credibility at stake as his two mills faced default of Rs 1.2 billion payments.
PSMA held the government responsible of pushing the whole industry in trouble by dumping and reminded to the authorities that massive import of sugar last year and then unloading of buffer stocks in the market played havoc with the industry.
It demanded that the government should honour its commitment of keeping sugar prices at Rs 31 at mills gate inclusive of sales tax to provide the industry a breathing space and warned that in case it did not pay heed to its call and may face the delayed crushing season.
PSMA also briefed the officials on payments of seasonal loans to the banks and said that majority of the mills would default on banks loans due to heavy losses. It presented stocks position during the meeting, which showed that mills, as on June 30, had 1.5 million tons unsold stocks enough to cater the need of the market for 6 months.
The government side was also given the prospects of the next crops. PSMA claimed that next years crop will be around 4.5 million tons again 05 to 06 million tons more than consumption. It estimates consumption for next season at 4 million tons.
It suggested that the government should take immediate notice of the situation and ask Trading Corporation of Pakistan (TCP) to procure 0.5 million tons sugar from the mills to keep buffer stocks, besides allowing export of sugar to Afghanistan.