Sugarcane production has increased by 4.9 percent to 58.

0 million tons in 2011-12

from 55.3
million tons last year.

PRODUCTION 2010-11
The Year under Review

Though the devastating floods in July 2010 had severe affects on all crops, but
sugarcane sustained the damages and turned out to be a higher yield crop being
water intensive.

The plantation Area and the crop condition of the sugarcane (2010-11) promised
high production in the beginning immediately after a deficit year. The devastating
floods all over the country damaged most of the crops and the infrastructure in the
country, but sugarcane crop was damaged the least, though flood losses on the
sugarcane crop were estimated higher in the preliminary reports, yet the
prolongedhumid favourable weather and the satisfactory water supply helped well
the growth of sugarcane crop.

Due to mixed estimates and expectations MINFA kept their estimate

of sugar production to as low as 3.1 million tonne and insisted a deficit of about

700,000 tonne. PSMA had hard time in convincing the Government of Pakistan to

hold the import of sugar till at least the end of February, when the production trend

would be much clear. At the same time authorities resisted the import of raw sugar

meant to supplement the production to save import of refined sugar.

After delaying the decision for import of refined sugar during crushing in

progress, Government of Pakistan was informed that they might need not to import

sugar as the production could exceed 3.9 million tonne. Due to the delay in

relaxation of import duty on raw sugar only a small quantity of raw sugar was

imported for refining. The pragmatic and realistic estimates of PSMA forced the

policy makers to review deficits anticipated and we had total sugar production of

4.17 million tonne.

Total scenario of the year 2010-11 was thus as following:

Sugarcane Plantation = 1,003,000 Hectors

Sugarcane Produced = 54,480,400 Tonnes

Sugarcane Crushed

(With 81.7% utilization) = 44,511,571 Tonne

Sugar Produced from Cane = 4,119,421 Tonne

Sugar Produced from Beet = 13,535 Tonne

Sugar refined from Raw = 39,629 Tonne

Total Sugar Produced = 4,172,632 Tonne

Carryover Stocks = 1,033,003 Tonne

(Mills & TCP)

Availability for (2010-11) = 5,205,635 Tonne

Thus the availability of sugar remained satisfactory till the end of the sugar year i-e
30

th September 2011. The carryover stock is estimated at about 1.1 mln.

Tonne inclusive 0.2 mln. Tonne at TCP reserves, which should suffice comfortably

for the month of October to December till the marketing of the fresh sugar from

crushing campaign (2011-12) which is expected to be surplus. Diversion of

sugarcane towards Gur making has been low in the year in comparison to past

years.

Sugarcane & Sugar Price 2010-11

Announced by the provincial Governments the support price of the

sugarcane was Rs 127/- in Sindh and Rs 125/- in Punjab and KPK per 40 kg. As

usual the growers were not happy with the announced price which is known as

minimum support price i-e the actual procurement price could be anything higher

than this. Availability of sugarcane when all the sugar mills start crushing at a time

becomes highly competitive and the sale price to the mills generally reaches

50-60% higher than the support price as a result of stronger demand.

The price of sugar always remain in lime light, which is an outcome of

sugarcane price directly proportional to it, as sugarcane price constitutes about

80% cost of production of sugar with further variations due to sucrose contents.

Rise in Sugar Imports Expected

Pakistans MY 2011/12 (October-September) sugar production is estimated at 4.3
million tons. With

the availability of 1.5 million tons as beginning stocks, total sugar supplies add up
to 5.8 million tons,

making for adequate supply on-hand. Pakistans MY 2012/13 total sugar production
is forecast at 4.1

million tons, down 5 percent over the current years estimate. Sugar consumption in
MY 2012/13 is

forecast at 4.4 million tons. The decision to export 400,000 tons of sugar during MY
2011/12 is likely

to affect ending stocks and resultantly will have a bearing on sugar availability
during MY 2012/13.

According to commodity traders and market analysts, the new policy seems
irrational because the

country would require importation of even more quantity of sugar next year. Thus,
the earlier import

forecast will increase from 200,000 tons to 600,000 tons during MY 2012/13. The
move may likely

have repercussions on domestic prices of sugar in the later part of the year.

ECC Decision to Export Sugar

On May 15, 2012, the Economic Coordination Committee of the Cabinet (ECC)
announced that they

have authorized the exportation of 400,000 tons of sugar, which according to a

recent Public Notice,
will be completed in two phases. The ECC made their decision after consultations
with the

Chairmanship of Federal Minister for Finance and Economic Affairs, as well as the
Ministry of

Industries; Trading Corporation of Pakistan (TCP) and other members of the

Committee. The decision

to export 400,000 tons of Pakistani sugar reportedly was based on political reasons
rather than on

normal market factors. The State Bank of Pakistan (SBP) was mandated by the ECC
to monitor the

exports. Because the export of sugar remains restricted both in terms of quantity
and class of exporters,

the Ministry of Commerce issued a Public Notice instead of amending the Export
Policy Order.

Government Facilitates Sugar Export

Moving forward, the Federal Board of Revenue has directed the Collectors of
Customs to allow the

exports of sugar based on the Public Notice' issued by the Ministry of Commerce.
The Notice makes it

mandatory for individual sugar mills (there are 84 sugar mills in operation in the
country) to export a

restricted quantity not to exceed 5,000 tons. The commodity would be cleared
based on the ECC

decision and Ministry of Commerce 'Public Notice'.

Potential for Sugar Price Increases

Sources in the Ministry of National Food Security and Research (MNFSR) reveal that
the ECC decision

to allow exports of sugar may result in an increase of sugar prices in the country.
Commodity analysts

reveal that sugar exports are not going to benefit growers or consumers as both will
be at a disadvantage

on this decision. The growers have already sold their crop and already received
payments from the sugar
mills. Consumers are likely to suffer economically due to the possible increase in
sugar prices.

Sugarcane support price is per 40 Kg. retail Price is Season's Average

Season
Crushing Actual
District TCD Utilization
PUNJAB Capacity Crushing
Location Capacity %
TCDx150 2010-2011
days
1 ABDULLAH (Depalpur) Okara 8,000 463,375 38.61
2 ABDULLAH (Shahpur) Sargodha 8,000 382,500 31.88
3 ADAM Bahawalnaghar 4,500 455,572 67.49
4 ASHRAF Bahawalpur 6,500 702,272 72.03
5 BABA FARID Okara 4,000 310,906 51.82
6 BROTHERS Kasur 10,000 499,199 33.28
7 CHANAR Faisalabad 5,800 592,160 68.06
8 CHAUDHRY Toba Tek Sindh 8,000 534,841 44.57
9 CHISHTIA Sargodha 7,000 196,707 18.73
Mandi
10 COLONY (Phalia) 7,500 367,675 32.68
Bahaudin
11 COLONY (Punjab) Khanewal 4,500 385,235 57.07
12 CRESCENT Faisalabad 3,000 -
13 ETIHAD Rahimyar Khan 12,000 747,843 41.55
14 FATIMA Muzafargrah 8,000 863,872 71.99
15 FECTO Bhakkar 5,500 479,367 58.11
16 G.SAMMUNDRI Faisalabad 5,000 74,703 9.96
17 HAMZA Rahimyar Khan 24,000 2,439,734 67.77
18 HAQ BAHU * Jhang 4,000 373,077 62.18
19 H.WAQAS Nankana Sahib 8,000 464,957 38.75
20 HUDA (Fauji) Sheikhupura 3,800 317,779 55.75
21 HUNZA (I) Faisalabad 8,000 621,272 51.77
22 HUNZA (II) Dargai 4,000 294,607 49.10
23 HUSEIN Faisalabad 6,000 582,239 64.69
24 INDUS Rajanpur 8,000 596,354 49.70
25 ITTEFAQ Pakpattan 5,500 532,260 64.52
26 J.D.W - I Rahimyar Khan 20,000 2,121,232 70.71
27 J.D.W - II (UNITED) Rahimyar Khan 8,000 867,796 72.32
28 KAMALIA Toba Tek Sindh 16,000 887,483 36.98
29 KASHMIR Jhang 6,000 648,715 72.08
30 KOHINOOR Khushab 406,388 #DIV/0!
31 LAYYAH Layyah 9,500 843,711 59.21
32 MADINA Jhang 10,000 601,292 40.09
33 NATIONAL Sargodha 5,000 322,088 42.95
34 NOON Sargodha 8,000 600,385 50.03
35 SAFINA (Ph-Wali) Jhang 5,000 537,095 71.61
36 PATTOKI Kasur 6,500 501,605 51.45
37 RAMZAN Jhang 8,000 561,794 46.82
Mandi
38 SHAHTAJ 8,000 925,506 77.13
Bahaudin
39 SHAKARGANJ - I Jhang 12,000 1,002,652 55.70
40 SHAKARGANJ - II Bhone Jhang 8,000 546,362 45.53
41 SHEIKHOO Muzafargrah 10,000 1,119,699 74.65
42 TANDLIANWALA - I Faisalabad 7,000 463,382 44.13
43 TANDLIANWALA - II Muzafargrah 5,000 513,475 68.46
Non- Members
44 G. B (PASRUR) Sialkot 40,000
45 MACCA Kasur 1,500 91,762 40.78
46 R.Y.K * Rahimyar Khan 821,314
TOTAL 2010-2011 PUNJAB 372,100 27,662,242 55.53

Total Capacity of Sugar Mills as Reported 2010-11

Season
Crushing Actual
District TCD Utilization
N. W.F.P Capacity Crushing
Location Capacity %
TCDx150 2010-2011
days
1 AL-MOIZ D. I. KHAN 14,000 664,624 31.65
2 CHASHMA D. I. KHAN 12,000 859,963 47.78
3 CHASHMA (Expansion) D. I. KHAN 6,000 493,690 54.85
4 FRONTIER MARDAN 880 Not Operated
5 KHAZANA PESHAWAR 3,500 120,762 23.00
6 PREMIER MARDAN 3,820 133,655 23.33
7 TANDLIANWALA(ZAMAND) D. I. KHAN 10,000 593,584 39.57
Non- Members
8 BANNU BANNU 2,400 169,446 47.07
TOTAL 2010-2011 NWFP 52,600 3,035,724 39.13

Season
Crushing Actual
District TCD Utilization
SINDH Capacity Crushing
Location Capacity %
TCDx150 2010-2011
days
 1 AL-ABBAS Mirpurkhas 5,500 594,000 72.00
2 Abdullah Shah Ghazi Thatta 3,500 267,547 50.96
3 AL-NOOR Nawabshah 9,000 888,736 65.83
4 ANSARI Hyderabad 6,000 561,266 62.36
5 ARMYWELFARE Badin 4,000 331,137 55.19
6 BAWANY Badin 7,000 350,937 33.42
7 DEWAN Thatta 9,000 396,458 29.37
8 KHOSKI Pvt Ltd Badin 4,500 200,867 29.76
9 DIGRI Mirpurkhas 5,500 365,307 44.28
10 FARAN Hyderabad 8,000 762,793 63.57
11 J.D.W.-III (GHOTKI) Ghotki 8,000 1,047,073 87.26
12 HABIB Nawabshah 8,500 800,636 62.79
13 KHAIRPUR Khairpur 5,000 322,787 43.04
14 KIRAN Sukkur 6,000 56,565 6.29
15 LARR Thatta 4,500 112,624 16.69
15 MATIARI Hyderabad 4,200 441,928 70.15
16 MEHRAN Hyderabad 7,500 804,169 71.48
17 MIRPURKHAS Mirpurkhas 5,000 509,204 67.89
18 MIRZA Badin 4,000 244,767 40.79
19 NAJMA Mirpurkhas 3,000 79,091 17.58
20 NAUDERO Larkana 2,000 197,282 65.76
21 NEW DADU Dadu 3,000 302,422 67.20
22 PANGRIO Badin 3,500 253,279 48.24
23 RANIPUR Khairpur 3,500 331,119 63.07
24 SAKRAND Nawabshah 6,000 615,017 68.34
25 SANGHAR Sanghar 5,500 491,205 59.54
26 SERI Hyderabad 5,000 125,849 16.78
27 SHAHMURAD Thatta 8,000 543,252 45.27
28 SINDABADGAR Hyderabad 4,200 359,480 57.06
29 TANDO M. KHAN Hyderabad 4,000 117,731 19.62
NON-MEMBERS
30 THARPARKAR Mirpurkhas 4,000 303,240 50.54
31 S.G.M. Ghotki 437,602
33 THATTA Thatta 2,800 Not Operated
34 BACHANI Hyderabad 4,000 Not Commissioned
TOTAL 2010-2011 SINDH 173,200 13,215,370 52.95

GRAND.TOTAL PAKISTAN 597,900 43,913,336 53.21

Molasses Production in Pakistan

From Cane, Beet & Raw (in Tonnes)
Year Punjab Sindh NWFP Pakistan
1990-91 1,119,978 611,033 473,432 35,513
1991-92 1,168,158 545,125 581,683 41,350
1992-93 1,330,419 632,055 652,789 45,575
1993-94 1,694,852 972,827 676,790 45,235
1994-95 1,010,890 592,067 47,994 1,650,952
1995-96 821,298 503,692 36,481 1,361,471
1996-97 798,448 482,636 32,661 1,319,860
1997-98 1,237,940 684,823 56,038 1,978,801
1998-99 1,276,391 760,533 76,670 2,113,595
1999-00 800,536 534,003 62,838 1,397,378
2000-01 901,732 550,605 40,480 1,501,501
2001-02 1,224,905 522,939 75,115 1,822,959
2002-03 1,304,284 656,520 87,313 2,048,117
2003-04 1,351,728 667,160 103,211 2,122,099
2004-05 1,039,937 393,287 64,171 1,497,395
2005-06 937,337 458,050 42,568 1,437,954
2006-07 1,222,482 578,833 109,787 1,911,102
2007-08 1,607,042 889,566 167,172 2,663,708
2008-09 928,514 493,079 114,739 1,536,332
2009-10 927,056 529,370 101,131 1,557,457
2010-11 1,249,324 643,651 141,580 2,034,555

Sugar Consumption
kg per capita in Pakistan (Graph)

Sugar Year Sugar per capita

1999-00 23.34
2000-01 21.77
2001-02 22.71
2002-03 23.86
2003-04 25.92
2004-05 25.83
2005-06 25.06
2006-07 24.29
2007-08 25.82
2008-09 21.34
 2009-10 24.12
2010-11 23.12

TECHNOLOGY ADOPTED

Double sulphitation process is employed for production of plantation white sugar which has a pol of
99.8% Government have laid down quality standards in terms of grain size namely large (L), medium (M),
small (S) and in the colour series of 31, 30 and 29 . In terms of ICUMSA, it corresponds to 100 to 150.

Automation of process control systems and continuous pans.

High pressure boilers, efficient turbines generating power.

Installation of bagasse dryers for fuel economy and energy conservation.

Modification of process for production of refined sugar.

ETP plants to meet with rigid pollution control norms

Reasons of Low sugar recovery

a. Lack of improved early and late maturing varieties

b. Short duration of sugarcane crop life

c. Prolonged duration of sugarcane crop life

d. Unhealthy crop

e. Over capacity operation of factories

f. Lack of facilities for training of staff.

Planning for the future

3.1 CYCLICAL SUGAR SHORTAGES: The Sugar Advisory Board has

been constituted to provide an institutional arrangement to resolve issues likely to
be faced by the Sugarcane growers and the Sugar Industry. To meet any shortages
between demand and supply, the Sugar Advisory Board has been advocating the
import of raw sugar during the late crushing period. Raw sugar is generally around $
60-100/ton, cheaper than white sugar and creates seasonal employment in the
economy as well. The rationale to import raw sugar during the crushing season is
that its processing is viable costing Rs. 4.50 to Rs. 5.00/Kg while after the crushing
season it costs around Rs. 8 /Kg.

Back

3.2 FUTURE SUGAR DEMAND: Our population was 31 million at

independence in 1947, stands at 170 million today and is expected to touch 208
million in 2020. [2] This situation demands that concerted efforts are made to aim
for self sufficiency in the production of sugar an essential food item both for the
present and for the years to come.

The Federal and Provincial governments have been periodically introducing policy
measures to facilitate sugar millers and sugarcane growers.

The Sugar Sector globally, particularly in the recent past has been found
susceptible to international market fluctuations, weather vagaries as well as a host
of other variables like pricing of other agriculture commodities. The general aim of
this policy is to strike a fair balance between the interests of the consumer,
sugarcane grower, sugar miller and to cater to unforeseen sugar shortages.

Business Cycle

Sugar industry occupies an important place among organizedindustries in Pakistan.

Being agro based, the industry has beeninstrumental in resource mobilization;
employment andincome generation; and creating social infrastructure in rural areas.
Indeed the industry has facilitated and accelerated pace of rural
industrialization.Being a basic commodity, the demand for the product is inelastic,
and carries through out business cycles. The demand is unlikely to decline in
foreseeable future on account of correlation with the growth in population and non
existence ofproper substitute. However, due to backward input relatedseasonality
effect the supply of the product indicates the high level of risk to sugar industry.

The above graph exemplifies the cyclical nature of sales growth in industry
hampered mainly on account of domestic production and supply of sugar in the
country. The expanding population and increased urbanization have also been
accounted for the growth in the industry especially in the current millennium. The
steady growth in demand will likely to continue on account of trends in population
growth and urbanization in the country.

Several industries also use sugar as an input in production. Furthermore, the by-
products of sugar industry molasses and bagasse are also used as inputs by some
industries. These industries include Beverages; Paper and Board; Bakery products;
Ice Cream Manufacturing; Sweet Manufacturing and distilleries etc. Growth and
technological development in sugar industry can thus be seen to have a widespread
impact on large-scale manufacturing activity.Gur and Desi Cheni are close
substitutes of sugar.However, the production of these commodities usually carries
out within the household on a very restrictive scale in the rural areas only. In the
last few years, the activity for producing Gur increased mainly in the province of
NWFP and tribal areas, affecting the mills in the province. This is mainly due to
demand of Gur by Central Asian Countries to produce alcohol. It is also used as a
substitute in most part of the province and adjoining tribal areas. Thus, the problem
of maintaining a smooth supply of sugar and its growth overtime gained strategic
importance.

INTRODUCTION
Pakistan Agricultural Research Council established Southern Zone Agricultural
Research Centre on the left bank of river Indus at Sujawal in 1982, with the
objectives:

Introduction of Coastal fruit plants

Research on Sugarcane

The centre was converted to Southern Zone Agricultural Research Institute during
1986 and during 1988 due to breach in river Indus, the institute came under flood
and most of the infrastructures were damaged, finally it was shifted to its present
location at Makli, Thatta during 1990.

The National Sugar Crops Research Institute (NSCRI) was initially a development
project funded by PARC through PSDP, government of Pakistan during 1995 for the
period of three years. This development project continued till 2003 due to late
releases and savings. The project on completion was converted to a regular institute
of PARC on 1-07-2003. The institute is located on Jungshahi road at Makli beside the
historic Makli graveyard. The compound comprises office buildings, laboratories and
residential buildings on 4 acres of land which was purchased from government of
Sindh. The institute owns 60 acre agricultural land used for sugarcane breeding
research at deh kalakot on Thatta-Ghorabari road, almost 14 km from the main
office.
Main Objectives of institute
To develop sugarcane varieties with high sugar yield for different agro-ecological
zones of the country,

To develop sugarcane varieties for stress conditions such as pests, drought, salinity,
frost and high temperature,

To develop agronomic requirements for the new varieties developed at the Institute,

To produce basic seed of new varieties in collaboration with progressive farmers,

To develop linkage between National and International Institutes for the exchange of
scientific information, visits of scientists and training of manpower.

Main Disciplines of Research / Sections within Institute

Sugarcane Breeding,

Sugarcane Agronomy,

Sugarcane Nutrition

Sugarcane Pathology,

Sugarcane Entomology,

Sugarcane Bio-Technology,

Prospects 2011-12
Preliminary reports indicate an increase of 12% in the plantation area

under sugarcane. The major increase being in Punjab has shown a rise from

672,200 Hectares to 754,700 Hectares promises an output of about 42.0 mln.

Tonne, 80% utilization of which may yield about 3.2 mln. Tonne sugar. Hopefully
we are moving towards Punjabs best harvest 2011-12 surpassing 2007-08

production.

Similarly Sindh shows 15% increase in the sugarcane plantation area

over the last year, but flood damages are yet to be ascertained as the flood water

in few Southern Districts has not receded yet due to poor drainage. There is

enormous damage in the cotton, paddy, sugarcane and vegetable fields. The

additional sugarcane plantation may not yield positive effects balancing the flood

losses, and the sugarcane production may remain closer to last years estimate of

over 13.0 mln Tonne.

Crop prospects in Khyber Pakhtunkhwa are good. Any increase in the

plantation area is not confirmed but sugar production is forecasted for at least 8%

increase with a sugar production of about 282,000 tonnes. Thus total production of

Pakistan for 2011-12 may hopefully exceed 4.7 mln. Tonne.

Sugarcane support price has already been announced as following for

2011-12 crops. Sindh Rs 154/-, Punjab & KPK Rs 150/- per 40 kg with an increase

of 20%. Crop availability is expected as normal; farmers demand for higher price as

usual will force the millers to a higher procurement cost.

It is a proven fact that sugar losses due to early start of crushing

campaign is about 250,000 tonnes due to low recovery which is a national loss. A

higher consumption of sugarcane in low recovery months causes short fall in

higher recovery months forcing the end of campaign.

The following study prepared clearly indicates the production loss due to
recovery %age and early end of crushing in the peak recovery period.
RECOMMENDATIONS
1. In order to deal with these perennial sugar crisis economic managers in Pakistan

especially those looking after the Agriculture sector should evolve a policy in line

with the buying power of the people at the gross root level.

2. In order to prevent situation from further aggravation, Ministry of Industries and

Production should devise comprehensive short term and long term policy

measures, instead of leaving the issue on the market forces. The policy measures

includes,

i. Appropriate import timing of raw and white sugar.

ii. Maintaining strategic reserves.

iii. Preventing smuggling of white sugar, integration of domestic

market with international market through necessary tariff

protection.

iv. Linking of sugarcane price with sucrose content.

v. Declaration of cane purchase receipt as a negotiable instrument.

vi. Research of high yield variety.

vii. Production of sugar cane from sugar beet.

viii. Sucrose testing facilities and monitoring mechanism.

3. Government should ensure incentives for sugarcane growers to grow cane and

that they are paid adequately and speedily by mill owners.

4. Consumer education campaign should be launched advocating reduction in the

consumption of sugar, which is already highest in the south asia.