SBP puts Khyber Pakhtunkhwa mills' sugar exports on hold, clears Punjab and Sindh under revised 200,000-tonne quota

Key takeaways

• The State Bank of Pakistan (SBP) issued a circular on Tuesday, 13 October, titled Revised Instructions – Export of 200,000 MT of Sugar.
• Banks may now process sugar export deals for eligible mills in Punjab and Sindh, whose provincial governments have endorsed the revised mill-wise quotas.
• Exports by mills in Khyber Pakhtunkhwa are on hold. The SBP says KP's endorsement "is still awaited" and will be passed on once the food security ministry confirms it.
• Exports must be paid in advance or through a sight letter of credit, and goods can go only by sea. There is no shipment deadline.
• The circular sets no retail sugar price; it only covers how mills can export their quota.

What the SBP said

According to Business Recorder and The News, the SBP said the governments of Punjab and Sindh had endorsed the revised quotas of mills in their provinces, so banks ("authorised dealers") can process their export transactions. For KP, banks must wait until the endorsement is communicated through the Ministry of National Food Security and Research (MNFSR).

The revised province-wise and mill-wise quotas came from the Pakistan Sugar Mills Association (PSMA) and were sent by the ministry on 9 October. That communication also corrected the names of three mills.

Conditions for exporters

Background

The Economic Coordination Committee (ECC) of the federal cabinet allowed the export of 200,000 metric tons of sugar in September 2026 on set conditions, and the federal cabinet later ratified the decision. Zaviya reports that a cabinet committee decided allocations among mills would be made strictly by provincial quota, based on verified crushing capacity and performance.

The SBP circular does not say why KP's endorsement is pending. The province has been under an emergency declared by the federal government this week, but no official link between that and the sugar quota has been stated.

What it means

• For mills in Punjab and Sindh: they can start export paperwork with their banks now, within their quotas.
• For KP mills: their share of the 200,000 tonnes cannot move through banks until the provincial endorsement arrives.
• For consumers: the instructions do not change shop prices directly. Any effect on local prices would depend on how much sugar actually leaves the country, which is not yet known.

What to watch

• When KP's endorsement reaches the SBP, and whether its quota changes.
• How quickly exports from Punjab and Sindh are shipped, since there is no deadline.
• Any move by the government on domestic sugar prices if exports pick up.