News

Check out market updates

Sugar prices to rise, say industry sources

LAHORE: The sugar prices are likely to increase, as the sugar mills have only four month stocks left and the production in the coming season will drop further, the industry sources told Daily Times Saturday.

They said the mills have only of 1.6 million tonnes of sugar stocks while the Trading Corporation of Pakistan (TCP) has 474,000 million tonnes of sugar.

The average consumption of the country is calculated at 450,000 tonnes per month. “Keeping in mind the month of Ramadhan, when the sugar consumption increases, the stocks are maximum for four months,” the sources said adding that the production of sugar will decline, as the sugarcane crop is very low.

Coordinator Farmers Association Pakistan, Idrees Khokhar said that the sugarcane production was estimated at least 20 to 30 percent less than previous year.

He said the major reason in decline was the treatment with the farmers, who declined their due price. The farmers were not paid the government announced support price of Rs 65-70 per maund in the previous year and the area of sugarcane cultivation also dropped. The price of sugar in international market was also calculated to be high because of low production.

Currently, the price of sugar in international market for August shipments is hovering at $396 per tonnes and freight $50 per tonnes thus the price in Pakistani rupees would be Rs 31,220 per tonnes and adding Rs 4,683 (15 percent sales tax), the price would become Rs 35,903 or Rs 36 per kg.

The prices of sugar would eventually come to at least Rs 38-40 per kg in September against current level of Rs 31-33 per kg. The industry stakeholders are calculating sugar production for 2008-09 at 3.5 million tonnes while in 2006-07 the sugar production was around 4.7 million tonnes.

Source: Daily Times

Discuss, analyse & share your views (kindly avoid sharing your email & contact number for your safety)