LAHORE: A major industrial standoff has erupted between the sugar industry and the provincial government after the Pakistan Sugar Mills Association (PSMA) North Zone openly rejected a sudden, late-night government directive to immediately begin the 2026-27 sugarcane crushing season.
According to an emergency press release issued by the PSMA-North Zone, the Punjab government issued a notification at 9:00 p.m. on November 14, 2026, ordering all sugar mills in the province to commence crushing operations the very next morning on November 15.
The association condemned the directive as highly impractical and operationally impossible. A PSMA spokesman clarified that under the Sugarcane Act of 1950, mills are legally permitted to commence operations by November 30. “The sudden issuance of such a notification in the dead of night is not a practical arrangement for the mills to start the crushing season,” the statement read.
Logistical Impossibilities and Safety Risks
Beyond the legal timeline, industry operators highlighted the severe mechanical and safety realities of starting heavy industrial plants. Bringing a dormant sugar mill to a fully operational state requires a minimum of 15 days. This transition period is mandatory to safely bring massive industrial boilers to full operational capacity, test heavy machinery, and implement critical precautionary measures for worker safety.
“How can the mill operations suddenly commence on the morning of November 15th, following the issuance of a notification the previous night?” the PSMA questioned.
The Core Dispute: A 1.3 Million-Tonne Bottleneck
The logistical dispute is severely compounded by a crippling financial crisis tied to massive unsold inventory. The PSMA revealed that since February 2026, the industry has been consistently pleading for permission to export 1 million tonnes out of a verified 1.3 million-tonne national surplus.
The association noted that the 1.3 million-tonne figure is not an estimate, but hard data verified by the Federal Board of Revenue’s (FBR) own Track and Trace system installed across the country’s sugar mills. Despite this digital verification, government bureaucracy has repeatedly dismissed these figures in various meetings, causing what the PSMA describes as “irreparable damage” to the sector without any administrative accountability.
Mill owners warn they are currently facing a severe financial crunch, bleeding billions of rupees in bank markups on the trapped inventory. The government itself is not immune to this crisis; the PSMA highlighted that the state is currently accumulating markup on 100,000 tonnes of unsold sugar—part of a 300,000-tonne batch previously imported by the government.
Industry Ultimatum: No Crushing Without Exports
Faced with overflowing warehouses, the PSMA-North Zone has issued a stark ultimatum: the 2026-27 crushing season cannot begin until the existing surplus stocks are exhausted.
Commencing the new season without opening export channels would effectively force a “complete shutdown of a major national industry,” the association warned, as current production would simply pile onto the already unmanageable stockpile. Projections indicate that without immediate policy intervention, the end of the 2026-27 season will yield yet another massive surplus, triggering continuous stock accumulation and unbearable financial pressure.
The association concluded its emergency release by reiterating its two core demands to the federal and provincial governments: the immediate export of the surplus sugar and the full deregulation of the heavily micromanaged sugar sector.