LAHORE: Punjab is once again facing a sugar crisis as dealers have stopped supplies amid major disputes between sugar mills, brokers, wholesalers, and retailers over the new government sugar prices – which have increased retail prices by up to Rs 200 per kg.
According to reports, the federal government recently fixed the ex-mill price of sugar at Rs 165 per kg and the retail price at Rs 173. However, the differences started when sugar mills allegedly refused to supply sugar at the government rate, instead offering it at Rs 176 per kg.
Dealers and brokers say that until the mills supply sugar at Rs 165 per kg, sales and distribution will remain suspended across Punjab. Sugar supply from the mills has been suspended for the past four days.
The Grocery Merchants Association said that they cannot buy sugar at Rs 176 and sell it at Rs 173. They claim that the profit margin at the official rate is very low — just Rs 8 per kg — while their operational expenses, including transportation, packaging and handling, are Rs 10 per kg.
They have demanded that the government fix the retail profit margin at Rs 12 per kg, irrespective of the fixed price. The association also warned that if their demands are not met, the existing stock of sugar will run out in three to four days, after which sales will be completely suspended across the province.
Rawalpindi Traders Association President Saleem Pervez Butt further warned that a strike will be called if retailers are fined, issued challans or forced to close their shops.