The retail price of sugar has hit Rs. 150-165 per kilogram due to a rise in wholesale prices.
Retailers are currently demanding Rs. 150 per kg, while online grocery websites, marts, and superstores have set retail prices at Rs. 155-165 per kg. Meanwhile, the sugar sector has shown signs of strong growth and posted record-high earnings.
Data from the Sensitive Price Indicator (SPI) indicates that the national average price for sugar in the country 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.
The Chairman of Karachi Wholesalers Grocers Association, Rauf Ibrahim, revealed that the wholesale price escalated by Rs. 8 per kg in the last 1-2 days, reaching Rs. 143 per kg, compared to Rs. 131-132 in the first week of July. He also conveyed concerns over the government’s inaction in tackling the surging sugar prices due to which sugar mills are jacking up the prices on their own.
In response to the situation, the Punjab government implemented 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.
Furthermore, the Punjab government plans to file cases against sugar millers and market traders for speculation and has 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.
Sugar Sector Profits
Sunny Kumar of Topline Securities stated that after many years, the sugar sector’s profits are showing signs of strong growth. The listed sugar sector’s earnings were up 23pc 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 jumped 25pc YoY to Rs235bn in 9MFY23 due to 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. International sugar prices have also risen by 31 percent from $17.42 cts/Ib in October 2022 to $22.89 cts/Ib in June 2023. Currently, it is at $24.37 cts/Ib.
Yet another gift from the outgoing inefficient government to the poor people.
Pakistan is the freest country in the world. Everybody is doing everything and anything and there is no control over what is going on.