Statistics belie PSMA estimates: 3.9-4 million tons of sugar output likely

The first monthly statistics of sugar production have contradicted the Pakistan Sugar Mills Association (PSMA) projections and brightened prospects that crushing season 2010-11, may end up between 3.9 to 4 million tons against the industry''s estimates of 3.1 to 3.2 million tons.
A report submitted by the Ministry of Industries and Production to the other government departments such as Federal Bureau of Statistics (FBS) noted that sugar production in the first month of the crushing season December 2010 stood at 0.575 million tons. The report said that with much better output in the first month of the crushing season 2010-11, there is a strong hope that prospects of sugarcane were very good and net sugar output will remain between 3.9 and 4.0 million tons.
Sources said the Ministry of Industries and Production foresees around one million tons sugar production each in January and February as crushing was at peak during these two months and in March and April the last month of the crushing season it expects around 1.2 to 1.3 million tons sugar. These calculations of the ministry suggest that net sugar production will remain close to 4 million tons. It added that since sugar rates are on the higher side there was strong possibility of 0.350 million tons sugar consumption per month in 2011. Taking lead from the production in December 2010 and higher than the last year prices the ministry is of the view that Pakistan''s total production will be enough to cater for 10 months (January-October 2011).
The official statistics of sugar output clearly contradict the PSMA''s claims of less production. The PSMA had time and again submitted to the government departments including the Ministry of Industries and Production that since sugarcane crop area was much less than the last year so will be sugar production. This year PSMA had estimated sugar production between 3.1 and 3.2 million tons. These claims had stirred panic among the government authorities who took these low sugar production figures to the Economic Co-ordination Committee (ECC) of the Cabinet with a request to import 1.2 million tons sugar. With better output in the first half of the crushing season, the government authorities are quite comfortable that sugar production in the current calendar year was going to very close to total consumption (3.5 million tons @ 0.350 tons per month). However they believe that Pakistan will need to import 0.5 million tons sugar in 2011 to build up buffer stocks to check any effort on the part of millers or dealers to hoard the stocks to create artificial shortage.