Karachi January 17 2022: Dewan Sugar Mills Limited (DWSM) crushed 340,759 million tons of sugar cane compared to 230,906 million tons last year. The plant started its Crushing on 9th December, 2020 and operated up to March 2nd 2021 for (84 days) as against operation of 56 days in the preceding season.
Availability of sugarcane is insufficient due to low yield shrinkage of sugarcane plantation and scarcity of
water, therefore the crushing season is minimized 80 to 90 days, which was earlier used to be upto 160 days.
Resultantly plant produced 33,936 million tons of sugar compared with 24,397 million tons of sugar last year. The sugar recovery level dropped to 9.97 percent compared with 10.55 percent last year.
On improved sugar cane crushing company reported loss decreased to PKR 795 million compared with PKR 886 million last year.
This substantial loss is apparently owing to underutilization of existing crushing capacity due to non-availability of working capital and pledge facilities. We have no other option but to sell the finished stock
during peak crushing season time when the prices are at the lowest level therefore in order to maintain continuity of supply of sugar cane & other cost of production. We could not avail the opportunity to take the benefit of increased prices after post crushing off-season as we do not have the stock carrying opportunity.
Distillery Operation was highly affected by Covid-19 as European buyers delayed shipments which increased the fixed cost and inventory carrying cost. The demand went down globally as last year inventories were higher at customer end. The plant produced 26,061 MT of industrial alcohol, as
compared to 18,807 MT of industrial alcohol last year.
The period under review operating loss of distillery unit was PKR 44.020 million as compared to operating
loss of PKR 138.938 million last year. Reduced profitability was owed to raw material cost which was
increased as compared to last year. The ethanol prices were increased this year, which resulted in the
reduction of operating loss as compared to previous year. However, in order to curtail the losses
management is taking various cost cutting measures and getting better prices in European markets.
Management is hope full that very soon they will come out from this uncertain situation and come back to positive