The government refuses to push sugar mills into early crushing; Rana Tanveer points out IMF restrictions
Sugar speculators have earned 134 billion rupees. PHOTO: PIXABAY
RAWALPINDI:
After vegetables, the country is now bracing for a new sugar crisis, with open market prices soaring again to Rs 200 per kilogram and official priced sugar virtually disappearing from retail stores in major cities.
According to traders, the government’s fixed price of Rs 181 per kg has become meaningless as no shop in or around Rawalpindi sells at that price. Wholesale prices have also skyrocketed: a 50-kilogram bag now costs 10,000 rupees, a sharp increase from previous weeks.
The fresh increase comes amid a 25 percent increase in freight rates for freight companies operating between Karachi, Rawalpindi and Peshawar, a rise that traders say will further aggravate retail prices.
Market watchers fear this round of increases could skyrocket in the coming days if the sugarcane crushing season is delayed further.
Meanwhile, the crisis also dominated the latest session of the National Assembly Standing Committee on National Food Security and Research, where Federal Minister for Food Security RanaTanveer Hussain briefed lawmakers on the situation.
“We have decided not to pressure the mills to start crushing,” he told the committee, explaining that each mill will decide for itself when to start operations. “Any mill can start crushing whenever it sees fit. Whether it is in the first week of November or the twenties, it depends entirely on it,” he added.
The minister pointed out that last year the price of sugarcane ranged between Rs 400 and Rs 700 per maund and as per the agreement with the IMF, the government cannot fix the purchase price of the crop.
“Punjab’s sugarcane crop will be ready on November 1,” Rana Tanveer said, pointing out that mills prefer late crushing to maximize recovery.
Sources told The Express PAkGazette that the federal government had earlier reached an understanding with sugar mills to start crushing in the first week of November, with the agreement signed by minister Rana Tanveer on behalf of the government.
However, by deciding not to enforce that schedule, the government has effectively safeguarded the interests of factory owners, a move that critics say will once again hurt farmers.
They warned that late crushing leaves producers facing large losses as their standing crop loses weight and quality, and also delays the planting of the next crop, creating a domino effect throughout the agricultural cycle.
Traders now fear that unless the crushing season starts on time, sugar prices will continue to rise, fueling another wave of inflation just as the masses struggle with rising food costs.
