According to Federal Committee on Agriculture, Pakistan, reported that surplus sugar output is likely in 2020-21 on the back of higher sugarcane production and healthy sucrose recovery with 75.9 million tons higher than last year’s produce of 66.8 million tons. Also, the government has decided to immediately allow import of almost 850,000 tonnes of sugar without any taxes and duties to prevent domestic price hike.
Pakistan is estimated to reap second highest sugarcane production of 75.9 million tons with Punjab harvesting 52.4 million tons against its previous record of 55. 2 million tons registered in 2017-18. Sindh too will produce 18.3 million tons which is higher than its previous year’s output. Khyber Pakhtunkhwa’s yield will be 5.2 million tons — slightly lower than last year’s crop of 5.3 million tons.
This year’s anticipated national sugarcane production of 75.9 million tons has also been much higher than last year’s produce of 66.8 million tons when Pakistan imported 0.3 million tons sugar at the end of season to curb prices. Similarly, Punjab’s sugarcane harvest is stated to be 52.4 million tons against last year’s 43.3 million tons.
Not only with a bumper crop of sugarcane this year, consumers should also get reasonably cheap sugar if expected volume of sweetener is compared with domestic consumption. According to an estimate, monthly national consumption stands at 0.45 million tons sugar. Hence, Pakistan needs 5.4 million tons of sugar to meet local yearly demand.
The last but one of the most important parameters to gauge sugar production has been sucrose contents out of sugarcane. As per official data of Punjab Food Department, this year’s sugarcane recovery has been hovering around 10 percent in central Punjab and reported to be over 11 percent in Southern Punjab. Sugar recovery used to be higher in Sindh if compared with Punjab.
Such a healthy sugar recovery from sugarcane also negates claims of manufacturers’ body about dent in sucrose yield due to early start of sugarcane crushing season, said official sources.
Based on evaluation of all production assessments and market data, it can be fairly assessed that national sugar production will be approximately 6.5 million tons against the demand of 5.4 million tons even if 15 percent of sugarcane are used for gur or jaggery making.
Moreover, another figure which can help policy makers in understanding sugar market has been latest manufacturing volumes and its comparison with last year’s data. According to provincial Food Department, since launch of crushing season this year, 1.9 million tons of sugar has so far been produced in Punjab against 0.98 million tons manufactured during corresponding period of last year. So around one million tons of excess sugar is available in the province this year and about 50 percent crushing is still remaining.
Market insiders believe that government should not shy in utilising available legal options to discourage hoarding of commodity with a view to ensuring smooth supply of locally manufactured sugar into the market. Such a strategy will help curb prices to reasonable level and provide a solace to consumers who have been burdened with inflationary pressures.
Furthermore, during the crushing season, import of raw sugar can be a viable option in the scenario, where sugarcane production is low. On the other hand, need to import of refined sugar should be assessed at the end of the crushing season after analyzing supply and demand data, said insiders.