HYDERABAD: Although the Sindh government has asked the Pakistan Sugar Mills Association (PSMA) to direct its members to run their mills from Nov 20 and start cane crushing by Nov 29, most of them are reluctant to follow the directive.

Adviser to the chief minister on agriculture, Manzoor Hussain Wassan, had taken the decision while chairing a meeting at the Sindh Secretariat on Nov 10. It was attended by MPAs Syed Zulfiqar Ali Shah and Shahina Sher Ali and agriculture secretary Ejaz Ahmed Mahesar, besides representatives of PSMA, Sindh Abadgar Board (SAB), Sindh Chamber of Agriculture (SCA) and farmers.

Cane growers, despite having been badly affected by recent floods that undermined their overall yield due to inundation of their lands, appeared desperate to start supplying their produce to the mills but most of the mills in Sindh are reluctant to start crushing in November.

The only exception is the Matiari Sugar Mills which has lived up to its tradition of starting crushing even without waiting for the government to notify the official indicative price of sugar cane.

Govt yet to notify official price; growers desperate to dispose of their produce to avoid losses

“We have started cane crushing on Nov 11,” said Matiari Sugar Mills management’s senior representative Dost Mohammad Baloch. He said cane growers were being offered a rate of Rs250 per 40kg for their produce. This rate was officially fixed for last year’s crop and the provincial government is yet to notify that of the current season.

Local cane growers, like Syed Nadeem Shah, reported that scores of cane-laden trolleys could be seen outside the Matiari Sugar Mills.

Mr Baloch agreed with him saying that around 2.5pc more sugar cane was at present available to his mills, which had the per day crushing capacity of 110,000 maunds. “We are telling them to stop bringing more cane because the surplus produce will get dried and thus cause an additional loss to the growers, who have already suffered economically due to floods,” said Mr. Baloch. alluding to the fact that sugar cane price is paid to them on the basis of weightage and cane loses weight when it dries up.

Nadeem Shah clarified that the Matiari Sugar Mills was buying the produce at Rs250 per 40kg and when the government would notify the new rate, it would be effective from the date of the notification. He believes that any differential, in case the official rate turned out to be higher, would not be payable to the growers.

Last year, 32 of the total 38 sugar mills in Sindh had crushed cane.

According to Mr Baloch, Kiran Sugar Mills has also started crushing. SAI’s Zubair Talpur, meanwhile, also confirmed that Tharparkar and Faran sugar mills had also fired their boilers and were likely to start crushing in the days to come.

The Sugar Factories Control Act 1950 -- amended lately -- allowed sugar mills to start cane crushing not later than Nov 30.

Veteran growers like Abdul Majeed Nizamani insists that crushing should be started in October considering the maturity factor of this high-delta crop.

Official rate issue

The Sindh Sugarcane Control Board (SCCB) was not able to decide the official indicative price of sugar cane procurement in the Nov 10 meeting, which was chaired by Mr Wassan.

SAB leader Mahmood Nawaz Shah had proposed a rate of Rs321 per 40kg for 2022-23 which, he said, was not contested by millers at the meeting, SCA’s Nabi Bux Sathio called for a rate of Rs350 per 40kg while SAI’s Zubair Talpur pressed for Rs400 per 40kg attributing the demand to higher production cost, due to hike in the prices of diesel, DAP fertilizer and other agriculture inputs.

Mr Talpur said growers had already incurred heavy losses due to the devastating floods; they lost everything they had; now they could survive only by getting a fair price of their produce.

But sugar millers have not yet shared their view on the official cane price for the current season although they always press for permission to export the sweetener. “The millers are rightly demanding permission for export of sugar out of their 1.5m tonnes carryover stocks. They should be allowed 800,000 tonnes,” said Mr Baloch. He argued that this would earn the country a foreign exchange of $400m to $500m if exports were allowed to sell the commodity at a rate of around Rs120 a kilo in the international trading.

Quality premium

“I think the SCCB is supposed to fix the price of sugar cane, and not sugar,” said Mr Shah. “The millers always press the point for sugar-related issues instead of sugar cane. We are ready to support them in their just contention provided they should also rescue us. By the way, why are millers shrugging from payment of quality premium to growers?” he wondered.

He was in fact referring to the delay in payment of sugar cane’s quality premium accumulating over almost two decades and now the arrears run into several billion rupees. The millers were supposed to pay quality premium over and above benchmark recovery of sugar cane which is 8.7pc in Sindh. Millers have already lost their case in the Sindh High Court and then appeal in the Supreme Court in their bid to deny this premium to farmers.

Sindh’s sugar mills crushed 22,277,208.19 tonnes of sugar cane to produce 22,914,66.750 tonnes of sugar with 10.283pc sugar recovery in the year 2021-22 when compared with 15,524,728.59 tonnes of sugar cane crushing figures in 2020-21 and production of 15,562,65.300 tonnes of sugar and 10.064pc of sucrose recovery.

Published in Dawn, November 16th, 2022