Sugar prices skyrocket in Pakistan, hit ₹180/kg amid Ramazan rush

Sugar prices in Pakistan have surged despite warnings from Deputy Prime Minister Ishaq Dar to keep them below ₹164 per kg. According to The Dawn, sugar now sells between ₹164 and ₹180 per kg nationwide.

The government’s crackdown on hoarders, announced by Prime Minister Shehbaz Sharif on March 15, briefly lowered Karachi’s wholesale sugar price from ₹168 to ₹158 per kg. However, rising demand during Ramazan pushed prices back to ₹168 per kg. Rauf Ibrahim, president of the Karachi Wholesalers Grocers Association (KWGA), criticized the government for failing to maintain sugar prices at ₹130 per kg. He claimed that while retailers face pressure, authorities have not acted against sugar millers.

Rauf called for an investigation into the actual cost of sugar production. He argued that without transparency, consumers will continue to pay inflated prices.

Meanwhile, a spokesperson for the Pakistan Sugar Mills Association (Punjab Zone) defended the industry. He argued that without sugar exports, the sector would have collapsed. At the end of September 2024, sugar mills had about 1.2 million tonnes of surplus sugar valued at Rs250 billion, pledged with banks at a 25% interest rate. He insisted that the government only allowed exports after verifying these surplus stocks.

In June 2023, the government and sugar mills agreed to maintain an ex-mill sugar price of ₹140 per kg during the 2023-24 export period. However, the spokesperson blamed fluctuating sugarcane prices for the rising sugar rates. He said sugarcane growers earned up to ₹750 per maund this season, raising production costs and future crop expectations.

The spokesperson rejected claims that sugar exports caused the price hike. Instead, he blamed market manipulation by the Satta Mafia, hoarders, and Karyana Merchants, who exploit media narratives to drive up prices.

For years, the sugar industry has urged the government to appoint independent auditors to verify sugar production costs. Industry leaders also recommend a two-tier pricing system to account for fluctuating production costs and market conditions.

Despite these calls, the government has not implemented any such measures, leaving sugar prices vulnerable to market forces and seasonal demand.