Pak high output queers pitch

India's sugar export market is likely to shrink further with Pakistan unlikely to import the commodity on the back of a good output estimate.

"Pakistan is looking at a sugar output of around 3.5 million tonne. With carryover stocks from last year's harvest, there will be enough to meet the demand making imports unnecessary," Mian Ilyas Mehraj, official with Hasseb Waquas Group, one of the largest producers of sugar in Pakistan, told NewsWire18.

Pakistan has around 600,000 tonne of carryover stocks from last year, while output in the current season has already touched 400,000 tonne.

Global sugar output has been pegged at 159.7 million tonne, raw value, in the current year ending September 30, while consumption is around 148.6 million tonne.

Last year, global sugar output was around 153 million tonne, while the demand was for 145.6 million tonne. Mehraj, who was in India recently, said crushing is progressing well and favourable weather would ensure good output. 

BITTER HARVEST Sugar production, imports & exports ('000 mn tonne)
	Production	Imports	Exports
INDIA
2002-03	22,140	10	1,410
2003-04	15,150	550	250
2004-05	14,170	2,135	40
2005-06	21,070	50	1,150
2006-07	25,100	0	2,000
PAKISTAN
2002-03	3,944	0	107
2003-04	4,047	350	214
2004-05	3,115	675	0
2005-06	2,615	1,050	0
2006-07	3,720	850	0
Source: USDA

Pakistan also follows October-September sugar season like India. Last year, it produced around 2.5 million tonne of the sweetener against a demand for 3.8 million tonne forcing it to lift a four-year ban on imports from India in the wake of rising sugar prices.

Pakistan had floated tenders to import close to 300,000 tonne sugar, of which India supplied around 200,000 tonne.

This year, however, the situation is different. India is struggling with a huge output estimate of 24 million tonne during October-September (2006-07) amid a fast shrinking export market.

Pakistan was a good option as exports were cost-effective, be it from land or sea, said another industry official. Sugar exports were banned from India in June to check domestic supplies and prices and tame inflationary pressure.

The ban was partially lifted on December 18, allowing companies with advance licences to sell. India formally notified lifting of the ban on January 3.

Currently, there is hardly any demand be it from Pakistan or any other country, as the global sugar market is likely to post surpluses this year, said C S Nopany, chairman and managing director with Oudh Sugar Mills.

Nopany said sugar mills should increasingly look at manufacturing higher grade 45 icumsa refined sugar and raw sugar to gain back the lost share. Icumsa rating is an international unit for measuring the quality or purity of the sugar. Lower the icumsa figure, whiter the sugar.

India traditionally has been a supplier of 100 icumsa sugar.