Pakistan Sugar Mills Association (PMSA) has reportedly warned the federal government that mills will be unable to commence crushing season on time, in case government does not allow further export of 0.5 millions tons of sugar and procure 0.2 million tons through Trading Corporation of Pakistan, well-informed sources told Business Recorder. This is the crux of Sugar Advisory Board (SAB) meeting held in the Ministry of Industries and Production on Wednesday.
Normally, sugar crushing season starts from November 1 every year but for the last two years crushing has not commenced on time with the mill owners citing different reasons for the delay. PSMA which is on autopilot in the absence of its central chairman who lives in the US pleaded its case before the officials of all the concerned ministries and provinces, but insiders claim that their pleas had little effect. PSMA’s central organisation was represented by Aslam Khan.
“We have requested MoI&P to allow export of 0.5 million tons of sugar immediately and make arrangements to procure 0.2 million tons through TCP to resolve the current crisis of the sugar industry,” said one of the participants. According to sources, PSMA’s representatives maintain that the mills have to pay millions of rupees to banks and in case of non-payment to banks, mills will be declared defaulters.
“Millers argue that sugar is in surplus in the country and the industry is constrained to sell below cost, which may result in default to banks,” the sources maintained. Trading Corporation of Pakistan (TCP) also faced criticism for not paying Rs 5 billion of sugar mills. TCP has procured 0.16 million tons of sugar from sugar mills in the light of the ECC decision.
“PSMA’s representatives were furious with the TCP and threatened to take up the payment issue at the Finance Minister level,” the sources continued. According to sugar industry sources, Ministry of Industries and Production has promised to submit a summary to the ECC of the Cabinet based on decisions taken in the SAB meeting.
However, official sources told this scribe that the ministry will not submit summary to the ECC till next month after receiving sugar production data from the provincial cane commissioners. “Sugarcane crop has been damaged due to heavy rains and flash floods in some parts of the country and we cannot submit any summary to the ECC until we receive detailed data of crops and possible sugar production from provincial governments,” the sources continued. Presently sugar stocks with the mills are around 2.1 million tons. Last month, President PSMA (Punjab Zone) Riaz Qadeer Butt wrote a letter to the Ministry of Industries and hinted at delay in crushing season in case the government does not make arrangements to procure 0.4 million tons of sugar through TCP.
