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Sugar price up by Rs 250 per 50-kg bag

10 July, 2007

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KARACHI: The price of white refined sugar shot up on Monday by Rs 250 per 50 kg bag in the wake of increasing demand and declining sugar stocks in the country, market sources said on Monday. Sugar demand is gradually increasing in domestic market as welfare organisations are buying huge amounts of the commodity for the affectees of recent rains in Sindh and Balochistan, they said.

"Demand of sugar has witnessed an increase of 10 percent during last two weeks in the local market," they added. They said that sugar price has gone up to Rs 2800 per 50 kg bag in the wholesale market against Rs 2550, depicting an increase of Rs 250 per bag.

Another main reason behind the recent price hike is considered the announcement by Pakistan Sugar Mills Association (PSMA) to delay sugarcane crushing by three months. Sugar price hike may affect the rates of the commodity in the retail market within the next two days and it is expected that its price will surge by Rs 2 per kg to Rs 31 per kg, said Chairman, Karachi Wholesalers Grocers Group, Anis Majid.

He said that further increase in sugar demand would spur its price upward, and added that price mechanism was based on millers' whims, whereas the government had not initiated any plan to assess market price of the commodity.

Pertaining to demand, he said that it was regular. However, stocks of sugar were on gradual decline which was also a reason for its price hike this month. He said that there should be about 1.4 million tons sugar in stock at present, as the country's total annual consumption is 3.8 million tons and production was 3.6 million tons, besides 0.4 million tons of previous stock.

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