A special meeting of the Sugar Advisory Board was held under the co-chairmanship of Ishaq Dar (Deputy Prime Minister) and the Federal Minister for National Food Security, Rana Tanveer Hussain, to review the sugar market situation, imported sugar stocks and the closure of the S-Track portal. The meeting was attended via Zoom by the deputy prime minister, while the minister joined from the Lahore office of the Pakistan Sugar Mills Association (PSMA).
The sugar industry claims that the government’s policy of prioritizing imported sugar and closing the Federal Board of Revenue (FBR) portals for local sugar sales has triggered the recent price surge and supply shortage.
For the past three weeks, mills across the country have been unable to supply sugar due to the portal closures — causing severe cash-flow problems and bank-loan repayment issues.
The PSMA had repeatedly warned that closing the portals would lead to shortages and price hikes; these warnings were ignored.
The government allowed roughly 300,000 tonnes of sugar imports even though local production was sufficient, according to the industry’s claim. Mill owners argue that domestic sugar industry is not responsible for the price increase; rather, dealers and profiteers are the main beneficiaries of the price surge.
During the meeting, options for the purchase and distribution of imported sugar via local mills were discussed and the minister assured immediate steps to restore the portal and ensure smooth supply.
The National Assembly Standing Committee on Commerce has formed a sub-committee to probe past sugar export decisions and directed the Competition Commission of Pakistan (CCP) to explain failures in controlling cartelization.
The key contention is that closure of the local sugar-sales portal (FBR’s S-Track or sales portal) along with a shift in policy favoring imported sugar have led to supply disruptions in Pakistan’s sugar market.
As a result, sugar mills claim they are unable to dispatch local sugar, causing a shortage and thereby pushing up prices. The industry is pointing to government policy and administrative action (portal closure) as the catalyst for the hike, rather than production or weather factors. A government investigation is now underway into export and import policy and possible cartel behavior to restore market order.
