Pakistan Urged to Export Surplus Sugar to Secure $500 Mills Boost Amid Mounting Industry Crisis

Islamabad: The Pakistan Sugar Mills Association (PSMA) has called on the government to urgently approve the export of surplus sugar from the ongoing 2025–26 crushing season, warning that failure to act could deepen the financial crisis facing the domestic sugar industry while depriving the country of much-needed foreign exchange earnings.
In a statement issued on Tuesday, the association highlighted that Pakistan is currently holding substantial excess sugar stocks, which, if exported promptly, could generate between $400 million and $500 million in foreign exchange and help ease pressure on the country’s reserves.
According to official data compiled by the Federal Board of Revenue (FBR), the carryforward stock as of November 15, 2025, stood at 271,704 metric tons, including both locally produced and imported sugar. Since the commencement of the current crushing season in November 2025, sugar production has reached approximately 7.573 million metric tons and is expected to touch 7.6 million metric tons once operations at the remaining mills conclude.
Additionally, sugar production from beet—estimated at an average of 86,809 metric tons between April and June—will further push total availability to nearly 7.96 million metric tons.
On the demand side, FBR figures show that the country’s annual sugar consumption during the last cycle stood at 6.476 million metric tons, with a monthly average of over 539,000 metric tons. Factoring in a population growth rate of 2.5 percent, next year’s consumption is projected to rise modestly to 6.638 million metric tons.
This supply-demand imbalance has resulted in an estimated surplus of around 1.32 million metric tons. Even after maintaining a one-month strategic reserve, approximately 767,000 metric tons of sugar remains in excess—stock that the industry insists should be exported without delay.
The PSMA warned that the accumulation of unsold sugar stocks has placed severe financial strain on mills. With domestic prices falling below production costs due to rising sugarcane prices and escalating input costs, the industry is grappling with mounting losses. This liquidity crunch has also hampered the sector’s ability to service bank loans and clear outstanding dues to farmers.
The association further noted that higher sugarcane prices over the past two years have incentivized farmers to expand cultivation, a trend expected to continue into the next season. As a result, sugar production is likely to increase further, potentially creating an additional surplus of up to 2 million metric tons.
Compounding the urgency, the PSMA pointed to escalating global oil prices linked to the ongoing Iran–United States conflict, which have significantly inflated Pakistan’s import bill. In this challenging economic environment, the association argued that exporting surplus sugar presents a timely opportunity to inject vital foreign exchange into the economy.
The PSMA reiterated its demand for immediate policy action, emphasizing that timely exports would not only stabilize the sugar industry but also contribute meaningfully to strengthening Pakistan’s external account position.