Islamabad 27 July: Pakistan is facing a deepening sugar crisis as retail prices surge past Rs190–200 per kilogram and supplies vanish from local markets. Traders are refusing to sell at government-mandated rates, intensifying a standoff with authorities.
Retail sugar prices have risen to around Rs190/kg in urban centers and up to Rs200/kg in rural areas, despite official price caps. In Punjab, particularly in Rawalpindi, traders have suspended sugar sales in protest against what they describe as flawed government pricing policies. They allege that a powerful “sugar mafia” is manipulating supply chains while small shopkeepers face raids and fines.
Meanwhile, sugar dealers across Punjab and other provinces have collectively halted the purchase of new stock under the government’s mandatory procurement policy, further depleting inventory levels. Current stocks are expected to last only 7 to 10 days.
Market Data: Govt Rates vs. Ground Reality
| Category | Government-Set Price (15 Jul – 14 Aug) | Open Market Price | Availability Status |
| Ex-Mill Price | Rs165/kg | — | Mills claim to comply |
| Retail Price Cap | Rs173/kg | Rs185–190/kg (e.g., Lahore, Karachi) | Government supply unavailable |
| Secondary Markets (Urban/Rural) | — | Rs190–200/kg | Completely unavailable at official rates |
Traders’ Stance
The Karyana Merchant Association of Punjab has blamed both provincial and federal governments for failing to control runaway sugar prices. Wholesale markets are witnessing daily increases of Rs100–300 per bag. Traders warn of worsening shortages and have announced a boycott, urging consumers to consider alternatives such as jaggery (gur).
In Lahore, reports from markets like Akbari Mandi and Gol Karyana indicate that sugar mills are not supplying stock at the official Rs165/kg rate. As a result, sugar is unavailable at government prices in most retail outlets.
READ MORE: ECC Halts Sugar Import Over Forex Constraints
Government Response & Import Efforts
Federal authorities have launched a nationwide crackdown on sugar hoarding and profiteering. Officials warn that any retail price above Rs164/kg violates official thresholds, and they have pledged strict legal action against violators.
Despite floating international tenders to import sugar—initially for 50,000 metric tons, later increased to 100,000—no bids were received due to tight delivery deadlines. The government hopes future imports will ease shortages and reduce prices.
The previous official sugar price of Rs72.22/kg has been officially replaced with an updated rate.
Parliamentary Probe
The National Assembly’s Standing Committee on Commerce has initiated an investigation into the recent surge in sugar prices, irregular trade activity, and alleged collusion between sugar mill owners, bureaucrats, and politicians.
Committee Chairperson Jawed Hanif Khan described the situation as “suspicious.” A sub-committee will examine claims that sugar was exported and later re-imported duty-free, allegedly benefiting specific stakeholders. All relevant ministries and departments will be summoned. The Pakistan Sugar Mills Association (PSMA) has confirmed the agreed ex-mill price of Rs165/kg.
Key Economic Insights
- The sugar industry generated Rs1.4 trillion in 2024–25 from 8.8 million tons of sugar production.
- Molasses, a byproduct used in ethanol production, contributed Rs154 billion in revenue, most of it from exports.
- Bagasse (sugarcane waste) produced 24 million tons of biofuel, powering mills and nearby industries.
- Some sugar mills use this energy for steel production, saving billions on electricity costs.
- No new sugar mill licenses have been issued in recent years, allowing existing mills to maintain market dominance.
