Assignment title: Sugar industries in Pakistan

Sugar making steps

Submitted By:
Umair Rasheed
2019-AGLB-01
BSc.(hons.) Agriculture
Ist semester
Agri-Economics AEC-102
Submitted to:
Dr Sajid Hussain

College of Agriculture Bzu-Bahadur sub campus layyah.

This assignment is submitted as a partial requirement of the course AEC-102(T) for the spring
semester 2019-2020

1) .Sugar Industries in Pakistan:

 81 sugar mills are working in Pakistan.

 42 in Punjab

 32 in Sindh

 7 in KPK
Role of Sugar industry:

 It is second agro base industry.

 Pakistan is important cane producing country and ranked fifth in the world

 Its shares in Agriculture are about 3.4 %.

 Its shares in GDP are about 0.7 %.

 It has very important role in our diet. We use sugar in almost all daily products, such as
soft drinks, Biscuits, Juices, Tea etc.

Production of sugar:

 Pakistan’s sugar 2017-18 (Oct- Sep) sugar production is estimated at 6.7 million metric
tones in addition to 2.2 million metric tones of beginning stocks, making for a total 2017-18
sugar supply of around 8.0 million metric tones.

 The sugar production during 20115-16, by close of crushing season was 6.634 million
metric tones. This was above the forecast of 6.4 million metric tones by the Pakistan Sugar Mills
Association. The sugar production is increasing year by year from 2011.It is occurring due to
high production of the sugar cane, sugar beet. The yearly trend can be seen in the below chart.

 The sugarcane production in 2017-18 is reported about 81.12 million metric tones against
the target of 75 million metric tons set by Pakistan Sugar Mills Association. . The yearly trend
can be seen in the below chart.

 The production of sugar in Punjab sugar mills is higher than the other sugar mills in the
Pakistan .It is because of the high sugarcane production rate in Punjab and also the rates of sugar
in the Pakistan sugar mills is low than other countries.

Total Sugar Production (mm) 2012-2018

Total Sugarcane Production (mm) 2012-2018

Province Wise Sugar Production:

Province Sugar Crushed Beat slice Sugar Cane production Total Sugar Molasses

Cane Beat Production

Punjab 52,230,008 -------- 4,881,378 ----------- 4,881,378 457,621

Sindh 26,040,145 -------- 2,350,784 ------------- 2,350,784 284,512

KPK 5,000,548 336,709 1561,536 18,216 1561,536 12,235

METHODOLOGY

The data source used in this paper consists of both primary and secondary sources.
The primary data were collected from the sugarcane growers and sugar industries
using a well-structured pre-tested set of questionnaires. From a total 400 growers,
80 sugarcane growers from each district were determined as a sample size. Due to
time constraint and non-cooperation of mills management, sample was selected as
4 industries from Sindh, 10 from Punjab and 1 industry from NWFP (now Khyber
Pakhtunkhwa) Provinces. Secondary data were collected from published annual
reports of Pakistan Sugar Mills Association (PSMA).

Technology

The cost advantage can be achieved through suitable technologies that affect the
productivity of labor and capital. The development and adoption of these
technologies affect the firm in several ways. The impact of employing new
methods depends, to a large extent, on firm behavior and industry structure. For
example, a productivity-enhancing technology enables the firm to reduce
production costs. Other technologies allow the firm to increase its output quality of
given an initial set of inputs. Suppose a technology is developed, such as a new
fertilizer application technique or a new variety, which increases yields in the
sugarcane. Upon adoption of this new method the grower could apply the same
amount of inputs as before, resulting in increased production levels (8). On the
other hand, an appropriate reduction in the amount of inputs applied will result in
production levels equal to those achieved with old technology. In this case, per unit
cost of production will decrease. This method is classified as a productivity
enhancing technology (6).

Input cost

Costs are also influenced by the price, quality, and dependability of purchased
inputs. This is one of the most direct and obvious sources of competitiveness. Even,
it is difficult for a firm to attain an advantage in this area. To illustrate this point,
suppose sugarcane composes the same share of production inputs for two
companies and that the cost of sugarcane declines. This decrease in the cost of
inputs affects both firms in the same way. However, it does not change either firm's
cost of production relative to the other. To gain a competitive edge, a firm must
lower input costs relative to those incurred by rival firms (6).

External factors
A number of external factors influence the competitiveness of agribusiness firms
and industries. A variety of government policies can affect an industry's
competitiveness in both domestic and international markets. For example,
government policies that subsidize the production of raw agricultural commodities
directly affect the prices that food processors pay for inputs. Lower priced inputs
lead to lower costs for the downstream firms and an increase in their
competitiveness relative to foreign rivals. Government policies also affect an
agribusiness firm's ability to obtain world market share. For example, government
export subsidies lower the world price at which domestic industries are willing to
sell various quantities of their product. This acts to expand the subsidized industry's
world market share. The macro-economic variables, such as exchange rates,
consumer incomes, and population growth also influence the competitiveness of the
firm (6).

RESULTS AND DISCUSSION

Before going into detail of sugar industry analysis, the understanding of

background information of the sugar mills is important. The information from
selected 15 sugar mills was collected and analyzed.

Crushing capacity

Sugar mills were divided in two groups i.e. small having crushing capacity less
than 6000 tons per day and large having more than 6000 tons per day. Out of sugar
mills interviewed in Sindh 50 percent fell in large size group having average
crushing capacity of 6167 tons per day. In Punjab 70 percent are of large size with
average crushing capacity of 8250 tons per day. Sugar industry of NWFP falls in
small size group with crushing capacity of 4000 tons per day. Moreover, data
(Table 1) also indicated that most of the sugar mills had increased their crushing
capacity as compared to the time of installation.

Type of machinery

It was found that overall 40 percent of imported machinery was installed in the
existing sugar industry in Pakistan. Moreover, 50 percent and 30 percent imported
machinery was installed in Sindh and Punjab, respectively (Table 1).

Ownership status
The results indicated that overall majority of sugar industries (73%) had sole owner
(Table 1). In Punjab 80 percent sugar industries had one owner as compared to 50
percent of sugar industries of Sindh. Overall 47 percent sugar mill owners have
more than one sugar mill and 60 percent mill owner’s family members also have
sugar mills. This indicates that sugar mill owners have monopolistic power in sugar
sector of Pakistan.

Status in PSMA

The status in Pakistan Sugar Mills Association was examined and found that
20 percent of respondents were office bearers of PSMA and 80 percent were
members only (Table).

Sampling method for sugarcane analysis

The data showed that all sampled mills had adopted simple sampling method rather
than core sampling method.
(Table 1) Characteristics of the selected sugar industries in Pakistan

Sindh Punjab NWF Over

P all
Crushing capacity
Installed crushing capacity (t/day) 2767 4900 4000 4093
Present crushing capacity (t/day) 6167 8250 4000 7500
Crushing capacity status
Large (>6000 t/day) 50% 70% - 60%
Small (<6000 t/day) 50% 30% 100% 40%
Type of machinery installed (Percent of
selected mills)
Texila 25 30 - 27
Ittefaq 25 40 - 33
Foreign 50 30 100 40
Mill ownership status (Percent of Selected
Mills)
Sole Owner 50 80 100 73
Partners 50 20 - 27
More than one sugar mills 50 40 100 47
Family member have sugar mill 25 80 - 60
Status in PSMA (Percent of selected
mills)
Office bearer 25 20 - 20
Member 75 80 100 80
Sampling method for sugarcane analysis (Percent of selected mills)
Simple sampling 100 100 100 100
Core sampling - - - -
Critical Success Factors:

Quality and Quantity of Sugar production:

The first critical success factor of sugar industry in Pakistan is the amount of sugarcane under
cultivation which in turn is highly dependent on the quality of sugarcane crop. If the yield from
sugarcane is low, then the unit cost of production increase for the sugar manufacturing units and
directly impacts their profitability.

GOP Policies:

GOP (Government of Pakistan) polices are very critical in success of sugar industry, If the
government policies are supportive (less restrictive), then a lot of investors are attracted to the
industry. Unsupportive and restrictive government policies can turn the investors away from
sugar industry i.e. untimely import or restriction on export of surplus sugar. This can create an
artificial shortage or glut in market hence affecting the price demand.

Banking Facilities:

Banking facilities available to sugar producers are very important factors in the success of sugar
industry. If good banking facilities are available, it can result in timely purchase of sugarcane and
holding of sugar stocks.

International and local Supply/Demand Scenario:

Success of sugar industry in Pakistan also highly depend highly on the International and local
Supply/Demand Scenario. The industry should be strong on the supply side so that it can fulfill
the local and international demand and also take advantage if there is international supply
shortage.

Management Quality:

Successful sugar companies have very good management quality. The management of successful
companies is very active reacting to different markets situation. If all the units working in the
sugar industry have good management quality, then it also plays very important role in success of
industry.

2).Steps involved in Sugar manufacturing:

 Cleaning

 Slicing or Grinding

 Juice Extraction
  Clarification of juice

 Concentration and crystallization

 Separation of Crystals

 Refinery of sugar

 Recovery of Sugar Molasses

1. Cleaning and Slicing:

First of all the sugar cane is arrived at mill yards and then it is transported to boilers for cleaning
purposes. Here, warm water jets are present which remove all debris and other pollutants
attached on sugar cane .this is very important process. After the cleaning the sugar cane is
transported to further machineries for the slicing and grinding. It is done so, that the crushing and
juice extraction occurs easily.

2. Juice Extraction

When the canes are thoroughly cleaned and cut into small pieces. These cane pieces are dropped
over a continuous belt of steel plates called the cane-carrier, moving over roller chains. From the
cane-carrier, these are conveyed to a crusher fitted with a set of revolving knives, and cut into
very small pieces. These small pieces in the form of a compact blanket are made to pass through
two roller crushers and four sets of mills. After major quantity of the juice has been extracted by
the crushers and the first two mills, cold or hot water is sprinkled over the Bagasse whereby
residual juice gets diluted and can be easily extracted by further milling. About 90-95% of the
juice is usually extracted. The juice extracted is weighed or measured as desired and sent for
clarification. In case sugar is to be extracted from sugar-beet, it is sliced and put in hot water
when the sugar present in the beet diffuses out. A number of tanks are used and worked on the
principle of counter currents—concentrated solution comes in contact with fresh slices and the
exhausted slices come in contact with fresh water and lose last traces of sugar in them. The
solution obtained is treated like cane-juice

3. Clarification of juice
Raw juice is dark opaque liquid containing about 15% sucrose and small quantities of glucose,
fructose, vegetable proteins, mineral salts, organic acids, colouring matter, gums and fine
particles of bagasse suspended in it. Allowed to remain untreated tore some time, it begins to
ferment and the sucrose present changes to mixture of glucose and fructose. In order to avoid
this, the juice is not allowed to stand untreated for a long time.The raw juice is dark opaque
liquid containing about 15% sucrose and small quantities of glucose, fructose, vegetable
proteins, mineral salts, organic acids, colouring matter, gums and fine particles of bagasse
suspended in it. Allowed to remain untreated tore some time, it begins to ferment and the sucrose
present changes to mixture of glucose and fructose. In order to avoid this, the juice is not allowed
to stand untreated for a long time.

o There are two main processes for clarification of juice:

(I) Sulphitation: Adding milk of lime and treating with sulphur dioxide. (ii) Carbonation:

Adding milk of lime and treating with carbon dioxide. Both processes have advantages of their
own. In fact combination of both is made use of to get better results.

(a) Defecation:

The juice is strained to remove suspended matter and treated with 2-3% lime till pH value
reaches 7.2 in tanks heated with steam coils.

Heating of the juice helps the coagulation of Albuminoids by lime. The vegetable proteins are
thus coagulated and the organic acids neutralized. These form a scum on the surface of the juice
when the hot juice is transferred to settling tanks called subsiders .The scum at the surface and
the mud settling at the bottom are mechanically removed by passing the whole through a filter
press and the clear solution sent on to the conical tanks for carbonation or sulphitation.

(b) Carbonation or Sulphitation:

A current of carbon dioxide is passed through the defecated juice, which contains unreacted lime
and calcium sucrosate (carbonation). This removes the excess of lime as calcium carbonate and
decomposes calcium sucrosate .Very often defecated juice is treated with sulphur dioxide
(sulphitation) instead of carbon dioxide which serves the same purpose and bleaches the juice in
addition, and produces a juice with much lighter colour. It prevents formation of brown mass by
oxidation, and brings about coagulation of gums and albuminoids more effectively. During the
process of sulphitation the solution is maintained neutral. In some cases ‘sulphitation’ follows
‘carbonation’. The juice is filtered again to remove the precipitates. At present all big sugar
factories in India are following double carbonation and double sulphitation process for the
manufacture of cane-sugar

4. Concentration and crystallization

The clear juice is concentrated in a multiple effect evaporator. Juice in the first pan is heated by
exhaust steam from the engines of the factory. The concentrated juice from the first pan is taken
to the second pan and heated there at a lower pressure, by steam from the first evaporator. The
concentrated solution from the second pan is taken to the third pan and heated there at a still
lower pressure by exhaust steam from the second evaporator. To this concentrated juice sulphur
dioxide is again applied. All through this process a strict control is maintained over the acidity of
the solution otherwise there will be losses due to inversion, destruction or even discoloration
may be there. The clear syrupy juice is just boiled in a vacuum pan till formation of sugar
crystals begins. The contents of the vacuum pan (massecuite) are taken into the crystallizing tank
and allowed to cool slowly when the tiny crystals of sugar grow in size

5. Separation of Crystals:

The crystals along-with the mother liquor (molasses) are whirled in centrifugal machines
wherein the molasses is removed. A little molasses adhering to the crystals is removed by
spraying cold water and whirling in the centrifuge again. The crystals are given a little blue color
and dried by dropping through a long pipe through which hot air is passing up and bagged.

6. Refining of Sugar:

Sugar in India is generally put in the market as obtained in the above process. In U.S.A. and
other foreign countries it is further refined by dissolving the crystals in hot water and
decolorizing the solution with animal charcoal or coconut charcoal. It is followed by filtration,
concentration under reduced pressure and crystallization as usual.

7. Recovery of Sugar Molasses:

The molasses still contains sufficient amount of sugar. It is boiled over again to get a fresh crop
of crystals. To recover sugar from the final molasses, the latter is treated chemically. It is diluted
and treated with hot concentrated solution of strontium hydroxide. Sucrose present forms a
precipitate of strontium sucrosate.This is separated suspended in water and treated with carbon
dioxide when strontium carbonate separates as a white precipitate and sucrose present in the
solution is decolorized, concentrated and crystallized as above. In India sugar is not extracted
chemically from molasses although still about 30 to 35% sugar is there. It is now being sent to
distilleries where it is fermented and used in the manufacture of alcohol…

By products:
1. Bagass: it is use again as fuel.
2. Molasses: It is supplies to distilleries and international buyers.

3. Filter cake or Bio fertilizer: It is used by sugarcane farmers as natural fertilizer.

  Over view of all steps;

Inspection Milling
Cane Wash

Cooking Concentration Purification Brot

h

Spin Molasse
Ethanol
s Filte
r
Cak
e
Preparation Fermentation
Sugar of wort

The End………………….