The price of white refined sugar has mounted by Rs 2 per kg in the retail market during this week because of sugarcane shortage to the mills amid ongoing crushing season, retailers and representatives of sugar industry said on Tuesday.
The commodity is now available at Rs 36 from Rs 34 kg last week, a retailer said that the calendar year is ending on Wednesday (today) which could be one of the secondary reasons behind the recent price increase during the crushing season. This might be an attempt from millers to fix arbitrarily new rates of the commodity ahead of next year.
Fareed Qureshi, secretary general of Karachi Retailers Grocers Group (KRGG) said that the price of white refined sugar in the wholesale market has climbed to Rs 3400 per 100 kg, which was previously available at Rs 3300. The market had closed at Rs 3250 per 100 kg last week.
"With the start of the current week, the price rose to Rs 35 from Rs 34 kg during last week and now it reached Rs 36 per kg," he said, adding that there are no market indications about the commodity price will further go up or not.
Anis Majeed, chairman of Karachi Wholesalers Grocers Association (KWGA) held the sugarcane crop shortage this year as a primary factor for increase in the sugar price in both wholesale market and subsequently in the retail market.
"The price of sugar is fixed by the sugar mills, not by the wholesalers, he made it clear and said that recent increase has taken place after the millers failed to receive a required amount of cane this season.
Expressing apprehensions, he said that there might be a chance of sugar price increase to Rs 38 per kg, which primarily depends on the mode of fixation by the millers. He pointed out that import of sugar, which does not seem viable at present, might scale down price in days to come. However, he said that there are clear signs that sugar is going to be imported once it becomes viable.
Marghoob Ahmed Siddiqui, secretary general, Pakistan Sugar Mills Association (PSMA) said that increasing cost of production has brought about surge in the sugar price in the local market.
"Cost of production is a basic reason and shortage of sugarcane crop this year for sugar price increase," he said and added that the mills are buying cane on the increased rates of Rs 90-95 per 40 kg as compared to the official support price of Rs 81. Crop has fallen short by 30 to 40 percent this year as compared to the crop production of the last year, he maintained.