ISLAMABAD, July 2: After wheat and cooking oil, a sugar crisis is in the making as millers have exported over four million tons of the commodity to Afghanistan and some other countries over the past three months.

Industry sources told Dawn on Wednesday that the crisis could push the sugar price to Rs42 a kg from Rs30 well ahead of Ramazan, which starts in September.

In some areas, sugar is being sold for Rs32 a kg.

Millers said they had exported sugar because the Trading Corporation of Pakistan had failed to buy the targeted quantity from them. The industry faced a “reverse crisis” two months ago because of abundance of sugar and a bumper crop and prices came down to Rs25 a kg.

At present sugar mills hold just 1.7 million tons stocks.

According to official figures, the TCP, which was to procure about 700,000 tons of sugar, has so far purchased only 472,000 million tons. The corporation is yet to float tenders for purchase of 200,000 tons.

The TCP is likely to miss the procurement target after the export of over four million tons of sugar. The corporation provides sugar to utility stores at subsidised rates. The TCP floated two tenders for procurement of 100,000 tons of sugar in May and June, but was able to procure only 46,000 tons.

Millers said they had exported the commodity to pay back growers. At present the mills are holding back about Rs35 billion of the growers. “The TCP has yet to pay Rs544 million to the millers on account of recent sugar procurement,” they added.

Official estimates show that during July, August and September, domestic sugar consumption will reach 450,000 tons a month. During Ramazan, the consumption can even touch 600,000 tons. It is feared that there will be a sugar crisis in October because the existing stocks are sufficient only for three to four months.

The Ministry of Food, Agriculture and Livestock (Minfal) and the Pakistan Sugar Mills Association (PSMA) have forecast a decline of 20 to 30 per cent in sugarcane cultivation and production for the next season.

A PSMA official told Dawn the government had not taken into consideration the 2.2 million tons of imported sugar it was supplying to the market while estimating domestic consumption. This showed the domestic consumption as less than what it actually was.

The country this year produced 4.7 million tons of sugar. According to the PSMA figures, domestic consumption this year will be 4.3 million tons, compared to 3.8 million tons last year. For industrial consumption, the country needs about 350,000 to 400,000 tons a month.

Minfal sources said if shortages occurred the government would have no other option but to import sugar, which could lead to a further hike in prices in the local market.