Coming in the midst of a welcome change in the conflicting viewpoints of the government and the industry on matters relating to the sugar economy, it is heartening to learn from a Recorder Report that the Economic Monitoring Committee (EMC), in its meeting, chaired by Advisor to Prime Minister on Finance Shaukat Tarin, on Thursday.
Which reviewed sugar prices, concurred with the proposal of the Ministry of Commerce and Minfal's for release of a part of strategic stock of sugar to stabilise market prices for public convenience, and decided to offload 50,000 tons of sugar in the market in order to ensure further reduction in sugar prices.
Earlier, on October 14, the EMC was reported to have been informed by the Finance Ministry that the Pakistan Sugar Mills Association's assessment of 3.7 to 3.8 million tons sugar output from 2008-09 crushing season, commencing November 15, its commitment to the government was also conveyed to the committee in its preceding meeting.
On that occasion, it had also been reported that notwithstanding a smaller area of plantation this time, PSMA strongly expected a reasonably large sugar production from upcoming season on the high hopes of a much better crop yield than the last season's, evidently because of timely rainfall. Significantly, PSMA Punjab and Sindh zones were stated to have duly submitted crushing season plans to the respective provincial Cane Commissioners.
Some idea of the industry's optimistic outlook of the next season may also be had from a PSMA team's dash to Islamabad, under the leadership of the Punjab zone chairman Javed Kayani, for meetings with the officials there to apprise them of its plan to encourage growers to work closely with mills to increase per acre yield.
As for the content of the plan, besides stressing the need of eliminating middleman's role in sugarcane buying, it envisaged provision of direct benefit to the growers, while also including a commitment on the part of the industry to ensure timely payments to growers. Viewed in the perspective of long years of controversy over growers' grumblings of delayed payments, the industry's overture would certainly be heart warming, to say the least.
At the same time it had also been stated that a report presented to the EMC had indicated that with the start of the crushing season, sugar prices would come down reasonably to the benefit of the consumers. Mention, in this context, had also been made to the likelihood the middleman exploiting the serious differences between the government and PSMA over the start of the crushing season, creating an impression of sugar shortage.
Again, as sugar prices had been indicating an upward trend for several months, and the prices of one kg sugar ranged between Rs 35 and Rs 36 in the open market the EMC was informed that the government would take all possible steps to keep the sugar rates at a reasonable level.
Now that the decision to offload the sugar stock has come ahead of the crushing season, it is hoped that good care would be taken ensure that it so phased as not to result in its oversupply, thereby averting a market crash as had happened on a previous occasion. As earlier noted in these columns, the sugar industry has had enough of bitterness on one count or the other, time has certainly come to bring it to its rational end.
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