After Punjab, Sindh has also announced the new support price of sugarcane for the current season but sugar millers have so far not begun crushing.

This is keeping prices stable in wholesale markets despite huge carryover stocks from last year.

On November 6, Sindh government fixed Rs172 per 40kg as the new indicative or support price of sugarcane, up from Rs154 per 40kg in the last season. (Punjab has increased the support price to Rs170 per 40kg from Rs150 per 40 kg in the last year).

After the announcement of new support price in Sindh, sugar millers are preparing to fire boilers. Simultaneously, they are demanding lowering of the price and are lobbying for this purpose. The southern zone of Pakistan Sugar Mills Association has even put out newspaper advertisements appealing to Chief Minister Qaim Ali Shah to be sympathetic to their demand.

On the other hand, sugarcane growers look frustrated over the new price which they say is lower than their input cost.

Most of them are unwilling to sell at Rs172 per 40kg. They are demanding as high as Rs200-Rs250 per 40kg citing increase in the cost of inputs including fertilizers, fuel and utility charges.

“Even firewood is selling for Rs300 per 40kg in the interior of Sindh. How can the government expect us to sell sugarcane at just Rs172 per 40kg?” questions Ghulam Qasim Jiskani who has grown sugarcane over 80 acres in district Khairpur.

Sugar millers say they may have to fire boilers of their mills from mid-November regardless of whether the government keeps the support price unchanged or lowers it on their demand, chances for which are very slim.

“Sugar mills normally take one or two weeks after firing their boilers to actually start cane crushing. So, crushing may begin by the end of this month or early next month,” manager at a sugar mill in Mirpur Khas told Dawn.

Delay in cane crushing, not only in Sindh, but also in Punjab has so far kept sugar prices stable. Commodity dealers at Jodia Bazar in Karachi and Akbari Mandi in Lahore said that the wholesale price of refined sugar moved between Rs49,000 and Rs50,000 per tonne in Karachi and between Rs50,000 and Rs51,000 in Lahore.

“Those who buy one or two bags of 50kg of sugar and not in tonnes pay a higher price. That’s a standard,” explained a commodity dealer at Jodia Bazar adding that recently some export-led buying of the sweetener was also seen in the market.

Sugar millers say they still have a little less than one million tonnes of carryover stocks of sugar produced in the last year adding that the government’s decision to allow export of 0.4 million tonnes in two installments since the beginning of this fiscal year has made it difficult to clear the stocks speedily. They say that the stocks cannot be exhausted anytime before the end of December or January given the slow-paced exports and no unusual buildup in local demand. That explains why the millers are trying to delay cane crushing as much as possible to avoid downward pressure on prices of newly produced sugar.

But, on the other hand, the delay in cane crushing, is delaying sowing of wheat. Growers say they are waiting for harvesting of cane to clear their fields for sowing wheat.

Wheat: News about delay in wheat sowing, amid ongoing exports of the last year’s stocks, is keeping local prices firm. For several weeks in a row wholesale prices of wheat have remained in the range of Rs3000-Rs3100 per 100kg and the same price range prevailed during the week that ended on November 9.

Flour millers say though the food departments of Sindh and Punjab are now releasing officially subsidised wheat a bit more generously than a couple of weeks ago, they are still buying large quantities of the commodity from the open market. This buying spree has pushed up demand for wheat and is keeping its prices firm.

“Quite often, the food department supplies us with low standard wheat. That too compels us to buy more from the open market,” complained a Karachi-based flour miller who also exports wheat-flour products. “A number of millers now make fine quality flour products including famous brands of bread and rusk which are also exported. Besides, they also make best brands of Chakki atta (wheat flour with higher brawn content). Obviously they can’t afford to use low-quality wheat and turn to open market to find the best kind of grains.”

Meanwhile, a team of Iranian officials are reported to have visited Pakistan and collected samples of wheat that they want to import from our country under a barter deal. Pakistan has agreed to provide half a million tonnes of wheat and 200,000 tonnes of rice to Iran in exchange for Iranian fertiliser and iron ore.

Pakistan’s official wheat reserves are estimated around 1.5 million tonnes of which half a million tonnes would be exported to Iran, if Iranian authorities are satisfied with the quality of wheat lying in official reserves.

RICE: Commodity traders say that arrival of non-Basmati rice produced in Sindh is picking up pace. But in Punjab supply of non-Basmati rice from rice mills to markets is yet to begin. That is why prices of Irri-6, Irri-9 and other hybrid varieties of coarse rice are higher in wholesale market of Lahore than in Sindh.

Dealers at Jodia Bazar say that during the week ended on November 9 prices of non-Basmati varieties ranged between Rs3800-Rs4000 per 100kg depending upon their quality. Against this, prices in Akbari Mandi of Lahore were seen moving in the range of Rs3800-Rs4200 per 100kg.

They say that prices of Basmati rice of various types have started inching up as harvesting of premium quality rice is being delayed. In Karachi’s whole sale markets including Jodia Bazar the best grains of Basmati were selling for as high as Rs12000 per 100kg during the week ended on November 10, up from Rs11000 a few weeks ago. In Akbari Mandi of Lahore, the prices of super quality Basmati was a bit lower—moving in the range of 10000-Rs11000 per 100kg, up from Rs9500-Rs1050 per 100kg about a month ago.

Traditionally Basmati prices in Punjab remain lower than in Sindh because the bulk of Basmati variety is grown in Punjab and in neighbouring Khyber Pakhtunkhwa.—Mohiuddin Aazim