Sindh not fixing sugar cane indicative price ‘to meet IMF condition’: official

Published January 25, 2025
TRUCKS carrying sugar cane queue up outside a sugar mill in Tando Allahyar on Friday. Perturbed growers fear millers may no more procure their crop as crushing process is nearing an end.—Photo by Umair Ali
TRUCKS carrying sugar cane queue up outside a sugar mill in Tando Allahyar on Friday. Perturbed growers fear millers may no more procure their crop as crushing process is nearing an end.—Photo by Umair Ali

HYDERABAD: The Sindh government has decided not to fix sugar cane crop’s indicative price for the year 2024-25 to comply with an International Monetary Fund (IMF) condition calling ‘open market’ in this sector.

“We will be informing the Sindh High Court (SHC) that since the government is showing its compliance of IMF conditions under an agreement, the price of sugar cane can’t be fixed. It is in the larger national interest, and we have placed this [decision] before Sindh cabinet as well,” said Sohail Qureshi, Sindh agriculture secretary.

He was alluding to the petitions filed in the SHC to seek fixing of sugar cane indicative price by the provincial government.

When asked that a specific law allows government to fix the price, he replied that the law did not make it ‘mandatory’ upon government to fix a price. He quoted the relevant proviso: “The government may fix the price of sugar cane…” to substantiate his stance.

The secretary said that the “IMF wants an open market mechanism, and that’s why the price is not yet fixed; and is not likely to be fixed either”.

Crushing process nearing an end

The cane crushing process, which had started in November last year, is inching towards closure. Around 30 sugar mills procured and crushed the cane crop in the ongoing season. Sindh has produced 2,022,780.929 tonnes of sugar in the 2023-24 season by crushing 19,279,206.410 tonnes of cane, recording 10.370pc sugar recovery percentage as per Sindh Cane Commissioner’s figures.

When compared with 2022-23 season, 16,789,161.093 tonnes of the crop was crushed to produce 1,744,808.150 tonnes of sugar although with a lesser recovery percentage of 10.1574pc. The lesser acreage and recovery in 2022-23 was attributed to the crop losses on account of the 2022 heavy rainfall and flooding.

A bone of contention

Fixing official price of sugar cane has been a bone of contention between millers and growers for a long time and the two sides often end up in litigation in high court and apex court. Millers have always been questioning Sindh government’s right to fix sugar cane price. They argue that it should also fix sugar price if it notified cane price.

Cane growers at mercy of millers

Last year Sindh agriculture department had fixed Rs425 per 40kg for 2023-24 season.

Since no price is being fixed by the department this year, cane growers are selling their produce at any rate being offered by millers.

“Until recently, a price of Rs400 per 40kg was being offered, and then it was dropped to Rs350 per 40kg. But again there are vibes that millers may further reduce it,” said Sindh Abadgar Ittehad (SAI) President Nawab Zubair Talpur.

Two other organisations of growers, Sindh Abadgar Board (SAB) and Sindh Abadgar Ittehad (SAI), through their representatives Umer Bughio and Zubair Talpur, respectively, have moved the SHC to seek orders to government to fix sugar cane price. The cases are pending before the court.

“We understand what government is saying about not fixing the price of cane crop. We just wonder then why government is fixing quota for sugar export if it is all about keeping ‘market open’ for any crop,” he argued.

Let fully-fledged sugar export take place in the country,”, contended SAB President Mahmood Nawaz Shah. He pointed that the Sugar Factories Control Act calls for fixing cane rate for the season, and that’s why being a growers’ body, SAB presses government to show compliance with this legal requirement.

Wheat support price

While Sindh government had fixed wheat procurement target in 2023-24, Punjab government did not do so. And this year, reports indicate that Sindh government might not fix wheat’s procurement price as well under the same ground, the IMF conditions.

Published in Dawn, January 25th, 2025

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