Manipulation of duties on molasses’ export: AFM urges CCP to take notice
October 30, 2012: Agriculture Forum Pakistan Chairman Muhammad Ibrahim Mughal has drawn the attention of the government and Competition Commission of Pakistan (CCP) towards duties on export of molasses discouraging its export in the benefit of local ethyl alcohol manufacturers causing a loss of Rs 10 billion to the country.
Talking to Business Recorder here on Monday, Mughal alleged that a cartel of local ethyl manufacturers have manipulated duties on export of molasses. He claimed that at present international price of molasses is Rs 9200 per ton while local manufacturers are buying it at Rs 6000 per ton only. Mughal said this year it is expected that country would have 60-62 million tons of sugarcane crop out of which around 55 million tons would go to sugar industry for crushing.
Crushing of this quantity of sugarcane would produce 5 percent molasses which come to 2.75 million tons, which if exported on today’s rate would fetch Rs 25.46 billion. While if this is sold to local manufacturer, which was paying 54 per cent lesser rate than the international market would bring only Rs 16.50 billion thus causing a loss of Rs 9-10 billion to the industry and this loss would be passes on to stakeholders by the industry. ‘ While the money earned through exports could have resolve the issues of sugar industry, ensure timely payment to the sugarcane growers and also help reducing the prices of sugar thus providing relief to the consumers,’ Mughal said and added that it would also add to national exports and give much needed foreign exchange to the country.
Agri Forum Chairman claimed that sugar world over was considered as by-product and main products are molasses, electricity and fertilisers made out of waste produced in the process of crushing of sugarcane. It helps in giving a reasonable price to the farmers and sugar to the consumers. However, he claimed that a cartel, which dubs molasses as by-product, was bent upon ruining the sugar industry, sugarcane growers and consumers in Pakistan.
He said molasses produced by the sugar industry would not remain to the millers and its export could help the government in earning precious foreign exchange and giving relief to the industry in shape of timely payment to the growers. He said that this matter warrant an urgent attention by the Competition Commission of Pakistan (CCP) to check the cartel creating hindrance in the way of export of molasses and of the Pakistan government to take decision on merit in this regard.
Mughal also urged the government to pay heed to buying the 1000 mw of electricity which could be produced by the sugar industry at the rate of Rs 4.60 per unit while baggase could help making chip boards of furniture. ‘We are completely ignoring these sectors and loosing money,’ he showed his disappointment.
He said even the mud or waste produced by the sugar industry could produce very helpful fertilisers which could be proved gold for the soil. ‘If we could pay heed to these issues we would help the sugar industry to over come its issues thus paving way for resolving the issue of timely payment to sugarcane growers,’ Mughal advocated.