The Pakistan Sugar Mills Association (PSMA) has called on the federal government to immediately allow exports of surplus sugar, warning that excess stocks are putting pressure on the industry’s financial stability.

In a communication to Deputy Prime Minister and Foreign Minister Ishaq Dar, PSMA Chairman Chaudhry Zaka Ashraf stated that sugar production during the 2025–26 crushing season has exceeded domestic demand, resulting in a significant buildup of inventories.

The association reported that total sugar stocks stand at around 7.9 million metric tons. After meeting estimated annual local consumption of about 6.6 million tons, the industry is left with a surplus of nearly 1.3 million tons. Even after maintaining strategic reserves, a sizeable excess of approximately 750,000 tons remains.

PSMA warned that the growing stockpile is creating liquidity constraints for mills, affecting cash flows and delaying payments to both growers and financial institutions. It added that current market prices remain below production costs due to higher input and raw material expenses, further squeezing margins.

The industry body estimated that exporting the surplus sugar could generate around $500 million in foreign exchange, helping ease pressure on the current account and supporting external sector stability.

PSMA also noted that a cabinet-level committee has been formed under the deputy prime minister to evaluate the export proposal, and expressed hope for a timely decision.

The association reiterated that continued accumulation of unsold stocks could deepen financial stress across the sugar value chain, including mills, farmers, and lenders, and urged swift approval of exports.