During the February-June period of FY23, Pakistan exported a significant quantity of 215,752 tonnes of sugar, which was a remarkable increase compared to zero foreign sales in the same period the previous year.
The sugar industry had been requesting permission for surplus export since March 2022 when sugar prices were around Rs80-85 per kg. The coalition government, led by PMLN, finally granted this permission in February 2023 in response to the demands of coalition partners, particularly the Pakistan People’s Party (PPP).
The trend of sugar exports started in February with 42,434 tonnes, and it tripled to 129,746 tonnes in March. The exports remained strong with 40,716 tonnes in April but gradually decreased to 1,893 tonnes in May and 963 tonnes in June.
However, due to the excessive exports, the average retail price of sugar soared to Rs150 per kg, leading to expectations of further price increases in the coming months. The mill owners, especially those from political families in the PDM government, benefited greatly from the export, earning Rs29.104 billion ($104.516 million) during February-June 2022-23.
Unfortunately, this came at the expense of consumers who had to buy sugar at almost double the prices that prevailed before the government allowed foreign sales.
According to a commerce ministry report, net sugar consumption in Pakistan exceeded 5 million tonnes. Therefore, a Re1 increase per kg of sugar results in over Rs5 billion being transferred from consumers.On the other hand, sugar imports witnessed a sharp decline of 98.01% in FY23, dropping to 6,205 tonnes from 312,477 tonnes in FY22.