Sugar mills in cotton areas opposed

The Cabinet Committee on Agriculture (CCA) has opposed setting up of more sugar mills in the cotton growing areas, and may advise the provincial governments to take steps in this regard, sources in Ministry of Industries and Production told Business Recorder.
"The provincial governments may be advised not to encourage installation of sugar mills in the cotton growing areas," sources quoted some participant as suggesting in the first ever meeting of the Committee, held on May 26 under the chairmanship of Prime Minister Shaukat Aziz.
It was also decided that sugar shortage during the current year may be assessed quickly, and timely action be taken for its import.
The Ministry of Food, Agriculture and Livestock (Minfal) briefed the meeting on areas and likely production of cotton, rice, sugarcane and maize during 2005-06. The Committee was informed that intervention price of cotton had been increased from Rs 925 to Rs 975 per 40 kg for next crop, while support prices for various crops of rice were increased in 2004-05.
According to sources, Minfal brought to the notice of CCA that because of timely payment by sugar mills for the sugarcane during last crop, a shift from cotton to sugarcane had been noticed in southern Punjab. Another reason for this shift was better availability of water.
Some problems regarding disposal of cotton stocks held by Trading Corporation of Pakistan (TCP) were also brought to the notice of CCA, besides a suggestion that a part of this stock should be sold in export as well.
It was felt that it was a complex issue and may be considered in a meeting to be attended by Ministers for Commerce, Industries, Minfal and Textile Technology. Commerce Ministry was asked to arrange the meeting, sources said.
The Prime Minister directed Minfal to firm up future strategy in respect of all the four crops (cotton, rice, sugarcane and maize), in consultation with the provinces, and submit it in the next CCA meeting.
The Committee was also briefed that wheat production in 2005 was not estimated at 21.331 million tonnes and there was downward trend in the prices of wheat and wheat flour during the last two months (7.11 percent and 5.09 percent respectively).
About water procurement, the Committee was informed that procurement of wheat by the private sector was also going on satisfactorily and the banks had extended Rs 3 billion credit to the private sector this year.
It was claimed that Rs 60 billion had gone to the rural economy which not only increased the rural income but would generate employment and use of improved inputs like seeds, pesticide and fertiliser by the farmers for the next crop, resulting in further enhancement in production, sources added.