Demand and supply of Sugar in 2010-11

Islamabad: Sugar supply 2010-11: Domestic sugar production: 41,56,392 tons, Leftover Stocks:19,575 tons, Imported Stocks with TCP: 400,000 tons, Sugar imported by private sector: 1,38,000 tons, Total: 47,13,967 tons:

Demand 2010-11: Total average consumption in the last three years has been 3.8 million tons. (2009-10 it was 37,86,556 tons or in one month 3,15, 546 tons of sugar was consumed). Average upper bench mark for sugar consumption is 350,000 Tons per month with 0.1 million tons extra in Ramadan i.e. Sugar demand in 2010-11is 4.3 million tons.

As regards allegations of smuggling, Sugar price in India, stands at PKR 61/kg. Sugar smuggling to India is not a viable option with their sugar priced at Rs. 10 per kg below our domestic price. There is in fact an incentive to smuggle sugar to Pakistan from India. Sugar price in Afghanistan is PKR 104/kg, but its annual demand according to ISO (International Sugar Organization) is only 235,000 tons which is imported from India, China and Brazil. Their demand is 5.6% of Pakistan’s current year’s sugar production. Smuggling of sugar per se to the neighbouring countries is not a viable option with high fuel costs by road. However, as a matter of abundant precaution Interior Ministry is taking preventive measures to check sugar smuggling.

Sugar has been exempted from sales tax through Finance Act 2011 while 8% Federal Excise duty has been imposed. Moreover 2.5% SED has also been abolished. As such with ex-mill price of Rs. 60/kg, 8% FED is Rs. 4.80/kg. Ex-mill price is Rs. 64.80/kg; wholesale Rs. 65.80/kg, retail Rs.66.80/kg. Therefore any increase in price above this is unwarranted.

The position of stocks shows that approx. 1.6 million tons sugar is available on 10th August 2011 compared to 0.63 million tons on 10th August 2010. The artificial creation of sugar shortage in Ramadan by hoarders and speculators needs to be checked firmly by the administration.

For more information, contact:
Haji Ahmed Malik
Principal Information Officer
Press Information Department (PID)
Tel: +9251 925 2323 and +9251 925 2324
Fax: +9251 925 2325 and +9251 925 2326
Email: piopid@gmail.com

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