Sugar millers delay crushing until December, seek more exports

Pakistan's sugar millers have decided not to begin the 2026-27 sugarcane crushing season before December, citing large unsold inventories and difficulties in exporting surplus sugar.

The decision was taken unanimously at a general body meeting of the Pakistan Sugar Mills Association (PSMA) on Wednesday, chaired by Asim Ghani Usman.

The meeting was held simultaneously in Lahore, Karachi and Islamabad, with mill owners from Punjab, Sindh and Khyber Pakhtunkhwa participating.

Why are sugar mills delaying crushing?

PSMA estimates that around 1.1 million metric tonnes of sugar remain surplus despite an existing government-approved export quota of 200,000 metric tonnes. Mill owners said the unsold inventories were making it difficult to start a fresh crushing season, as additional output could increase stocks and the financial cost of holding them.

The association complained of delays in export arrangements, although the State Bank of Pakistan had issued instructions allowing banks to process export transactions for eligible mills under the existing quota.

Sources familiar with the meeting said millers also linked the start of crushing operations to exporting surplus stocks and securing deregulation of the industry.

What are sugar millers demanding?

The PSMA general body authorized its executive committee to approach the federal government for immediate permission to export an additional one million metric tonnes of surplus sugar.

The association also demanded the announcement of a long-awaited deregulation policy, arguing that existing government controls were adding to the industry's operational and financial difficulties.

Mill owners warned that another substantial surplus could emerge by the end of the 2026-27 crushing season, further increasing inventories and financial pressure.

They said delays in government decisions on additional exports and deregulation could worsen the situation.

What happens next?

The association proposed writing to the deputy prime minister to request a meeting on the challenges facing sugar manufacturers and the policy changes sought by the industry.

PSMA also decided to hold a news conference in Lahore on November 16 to announce its future course of action regarding the crushing season, sugar exports and deregulation.