Sugar Prices in Pakistan Stay High Despite Government Efforts

Sugar prices in Pakistan are still high, ranging from Rs164 to Rs180 per kilogram in many cities, even after the government ordered rates to drop below Rs164 per kg. Official warnings and actions against hoarding have had little effect.

Rauf Ibrahim, President of the Karachi Wholesalers Grocers Association, said wholesale sugar prices in Karachi briefly fell from Rs168 to Rs158 per kg after Prime Minister Shehbaz Sharif’s March 15 statement targeting hoarders. However, retailers didn’t lower their prices by the Rs10 drop, cashing in on strong Ramazan demand instead.

He pointed out that the government hasn’t managed to push prices down to Rs130 per kg, accusing them of only targeting retailers while letting sugar mills off the hook. After talks between millers and officials, he said wholesale prices climbed back to Rs168 per kg, and called for a check on sugar production costs.

A spokesperson from the Pakistan Sugar Mills Association (Punjab Zone) denied that exports are behind the price rise. They said the industry has a 1.2 million-tonne surplus—valued at Rs250 billion—as of September 2024, held with banks at 25% interest. Delayed export approvals nearly sank the industry, and exports were only permitted after the government confirmed the surplus multiple times.

The spokesperson added that in June 2024, they agreed with the government to keep the ex-mill price at Rs140 per kg for the 2023–24 season during exports. They noted sugarcane prices hit a high of Rs750 per maund this season, helping growers and securing future crops, and called it unfair to blame exports alone for sugar prices.

The PSMA instead pointed to market issues like speculation and hoarding by the “satta mafia” and retailers as the real culprits. They said sugar is available at Rs130 per kg at 274 official stalls until April 19. The industry has long asked for independent audits of production costs and suggested a two-tier pricing system—separating the commercial sector (80% of sugar use, unregulated) from household buyers. They’re willing to work with the government to keep prices affordable for homes.

SOURCE: The Profit Magazine Pakistan