KARACHI: As the government trumpets decline of Rs15-20 per kg in the price of sugar in coming days, the wholesale rates of the sweetener has further swelled to Rs99-100 per kg from Rs98 per kg.
Wholesale sugar price has already witnessed a jump of Rs5 per kg ahead of Rabi ul Awal to Rs98 per kg despite frequent imports by the government and private sector.
On Saturday, Federal Minister for Industries and Production Hammad Azhar had hinted a drop of Rs15-20 per kg price of sugar in coming days due to arrival of imported sugar.
The government has not taken any action against wholesalers and retailers for pushing up the rates ahead of Rabi ul Awal when demand usually soars due to mass preparation of sweetmeat (mithai) and desserts. Retailers are charging Rs105-110 per kg for sugar depending on the areas, which was priced Rs95-100 per kg prior to Rabi ul Awal.
Increase in price of sugar is surprising as one dollar now sells at Rs158.91 in the interbank market as compared to Rs168.43 in the last week of August, showing an appreciation of over five per cent in the above period. This makes imports of finished goods and raw materials cheaper.
However, confusion has persisted as wholesalers and importers claim that the price of imported sugar has been stagnant and increase in rates has been registered in locally produced sugar of last season, with stocks at a critically low level in the open market.
Locally produced regular sugar has larger crystals as compared to the imported variety which is finer and has smaller crystals.
Interestingly, retailers either mix cheap imported fine or superfine sugar with locally produced variety or directly sell imported sweetener at a higher rate of Rs100-110 per kg while blaming wholesale price hike.
Patron Karachi Wholesalers Grocers Group (KWGA), Anis Majeed said wholesale price of locally produced sugar has gone up while stocks diminish. “Prices would crawl down after the start of sugarcane crushing in the second week or third week of this month,” he said.
President Cereal Association of Pakistan, Muzammil Chappal claimed that Pakistani consumers do not like imported fine sugar which had arrived from Dubai, Brazil and Egypt.
He said fine imported sugar is available at Rs88 per kg. When asked as to why fine sugar was imported, he said majority of the countries produced and consumed this variety while people in Pakistan, India, Bangladesh and Sri Lanka like the bigger, coarser crystals found in locally produced sugar.
Chappal said the price of locally-produced sugar has risen whereas that of imported has not.
Private sector has imported 150,000 tonnes from September to October 28 while Trading Corporation of Pakistan is also bringing imported sugar.
Pakistan’s sugar production in FY20 plunged by 7pc to 4.881 million tonnes. In July, production of sugar stood at 4,309 tonnes versus 14,640 tonnes in July 2019. In August 2020 and 2019, the large scale manufacturing figures showed zero production.
Published in Dawn, November 10th, 2020
