Karachi, May 24 - Pakistan is likely to face a shortfall of around 900,000 tonnes of refined sugar in the production year starting November, making further buying from India probable, industry and trade officials said on Wednesday.
Zaka Ashraf, chairman of private Pakistan Sugar Mills Association, said the shortfall next year was expected to be lower than this year's 1.32 million tonnes, but would again leave the country searching for sugar in the world market.
Over half of Pakistan's imports came from India following removal of a four-year ban on Indian sugar last year after an improvement in relations between the two neighbours.
"The output is expected to rise to between 3.0 million and 3.1 million tonnes from 2.58 million tonnes (a year earlier), but the domestic demand is also growing at a fast pace," Ashraf told Reuters by telephone from the eastern city of Lahore.
Industry officials say domestic demand will be around 4.0 million tonnes in the next production season, up from current 3.8 million tonnes.
Sugar demand is rising in Pakistan, due to rapid population growth, and in neighbouring Afghanistan, from where it is smuggled to Central Asia.
Ashraf said the sugarcane crop next year is expected to touch 50 million tonnes as the area under cultivation has risen by 8.7 percent to around one million hectares (2.5 million acres).
This, he said, would result in an increase in refined sugar output next season.
Pakistan's 13-month-long sugarcane season starts in February and ends in March the following year. The harvest fell last season to 44 million tonnes.
But last year, sugarcane became the most profitable crop in the country, as shortages pushed prices to an all-time high of 120 rupees per 40 kg, almost double the government's fixed price.
"As of now, the crop reports are very encouraging, but at the same time irrigation water shortage is also a matter of concern," Ashraf said.
"If it persists then the harvest would be hit and consequently refined output could also be lower than we expect."
Pakistan's major summer crops face a threat as winter rainfall was 40 percent below normal and snowfall was 25 percent less than normal.
INDIAN SUGAR
Industry officials expect that the shortfall next year will again be bridged by imports from neighbouring India, which expects a 16 percent increase in the output next season.
"Like the current year, most of the cargoes next year will also come from India as our main focus will again be on the imports of refined sugar," said a Karachi-based dealer. "Imports of raw sugar will only be viable if prices fall."
Pakistan had imported 1.044 million tonnes of sugar in the first eight months of fiscal 2005/06 (July-June), compared with 98,677 tonnes in the same period last year, according to government data.
In April, sugar imports rose to 231,681 tonnes, worth $85 million, compared to 144,143 tonnes, or $50.45 million, in March.