Pakistan, the world’s fifth-largest sugarcane producer and sixth-largest sugar manufacturer, continues to experience recurring sugar crises from 2008 to 2025. Despite being a critical agro-based sector—supporting employment, industrial output, and rural economies—supply-demand imbalances and price volatility have created persistent challenges.
One key factor driving these crises is the lack of an effective system to collect and verify production, stock, and trade data. Additionally, limited oversight and policy influence have allowed market conditions to favor certain participants, creating supply imbalances. For instance, export approvals combined with domestic supply pressures have sometimes concentrated profits among a few players, while the wider market and consumers face the consequences.
Industry faces market manipulation, hoarding, uneven enforcement of minimum support prices, overlapping federal–provincial jurisdictions, and the absence of transparent and timely data. Recent crises were intensified by export approvals followed by shortages, repeated hoarding, artificial scarcity, weak enforcement, delayed payments to farmers, and outdated procurement systems.
To address these challenges, a comprehensive reform blueprint recommends:
- Establishing a National Sugar Market Surveillance Authority to monitor supply, stocks, and trade flows.
- Adopting digital tracking systems for production, warehousing, and distribution.
- Modernizing mills and processing practices to increase efficiency and quality.
- Implementing quality-based payments to farmers to ensure fair compensation.
- Promoting transparency and accountability through conflict-of-interest codes and integrated reporting.
With the Pakistan sugar industry valued at over PKR 1,000 billion, generates significant economic activity, but benefits are concentrated among a limited number of sugar mills, while the public bears the cost. The industry’s complex structure, governed by both federal and provincial laws, creates regulatory loopholes that enable unfair practices such as cartel behaviour, and discouraging new investors. By adopting these reforms, Pakistan can strengthen its sugar sector, ensure consistent supply, and create a resilient market that serves both producers and consumers effectively.
