[vc_row][vc_column][vc_column_text dp_text_size=”size-4″]The retail price of sugar in Pakistan has surged to Rs. 150-165 per kilogram, mainly due to a rise in wholesale prices. Retailers are currently selling sugar at Rs. 150 per kg, while online grocery websites, marts, and superstores have set retail prices at Rs. 155-165 per kg. This significant price increase comes despite the sugar sector showing signs of robust growth and posting record-high earnings.
Data from the Sensitive Price Indicator (SPI) reveals that the national average price for sugar rose to Rs. 135-160 per kg in the last week, compared to Rs. 125-140 per kg in the first week of July and Rs. 87-100 per kg in the first week of January 2023.
Rauf Ibrahim, the Chairman of Karachi Wholesalers Grocers Association, disclosed that the wholesale price of sugar surged by Rs. 8 per kg in the last 1-2 days, reaching Rs. 143 per kg, as opposed to Rs. 131-132 per kg in the first week of July. He expressed concerns over the government’s inaction in dealing with the soaring sugar prices, leading sugar mills to raise prices independently.
To address the situation, the Punjab government took certain measures in the last week of July, including confiscating sugar that was being stockpiled for black marketing purposes. The recovered sugar will be sold by the government, and the funds will be directed to the national exchequer.
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Additionally, the Punjab government plans to file cases against sugar millers and market traders for speculation. They have granted the cane commissioner the authority to regulate the storage, transport, and distribution of sugar and fix rates.
However, Rauf Ibrahim expressed dissatisfaction with the overall response of federal and provincial governments in tackling the issue and questioned the effectiveness of actions taken so far. The extent of recovered sugar stocks from markets and sugar mills, accumulated to exploit the prevailing situation, remains uncertain.
On the other hand, the sugar sector has witnessed impressive profits, showing strong growth after several years. The listed sugar sector’s earnings surged by 23% year-on-year to a record high of Rs. 14 billion in the first nine months of FY23 (Oct-2022 to Jun-2023) due to a rise in sugar volumes and prices.
Net sales of the sector also increased by 25% YoY to Rs. 235 billion in 9MFY23, driven by the export of 216,000 tons from February to June 2023, fetching $104 million. The government had allowed the export of 250,000 tonnes of sugar from January 2023 till June 2023. Furthermore, international sugar prices rose by 31 percent from $17.42 cts/Ib in October 2022 to $22.89 cts/Ib in June 2023 and currently stand at $24.37 cts/Ib.[/vc_column_text][/vc_column][/vc_row]
