The millers oppose a government decision to allow unlimited imports of raw sugar after massive sugarcane crop losses, an industry official said on Friday, adding the shortfall would be smaller than expected.
The government this week waived a 25 percent regulatory duty and allowed millers and traders to import raw sugar at will after estimates the 2010/11 crop would produce about 3 million tonnes of refined sugar against an annual demand of 4.2 million tonnes.
Millers estimate output at 3.6 million tonnes and say the government should set a limit in line with total demand.
"We are telling the government that there should be a limit on the import of raw sugar. It should not be more than 500,000 tonnes," Iskandar Khan, chairman of the Pakistan Sugar Mills Association (PSMA), told Reuters.
"We are expecting 3.6 million tonnes of sugar output after flood damage and together with raw sugar import and purchases being made by the TCP, the availability will be according to our consumption," he said referring to the TCP.
While Khan frames the issue in terms of protecting local farmers and even health issues surrounding unprocessed sugar, unlimited sugar imports would drive down domestic prices and cut into industry profits.
Pakistan aims for a sugarcane harvest of 54.8 million tonnes for 2010/11 ― which could produce roughly 3.8 million tonnes of white sugar ― before August floods destroyed millions of acres of cropland.
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