CCP Issue Notice to 10 Sugar Mills for Price Fixing and Crushing Delay

The Competition Commission of Pakistan has issued show cause notices to ten sugar mills in Punjab after finding that they collectively fixed the sugarcane procurement price at Rs. 400 per maund and jointly decided to delay the start of the crushing season. According to the CCP review, representatives of these mills gathered on November 10 at a meeting hosted by Fatima Sugar Mills, where they agreed to begin crushing on November 28 instead of the officially notified date of November 15. The commission said that the mills’ collective move to fix the cane purchase rate at Rs. 400 per maund amounted to coordinated decision-making in clear violation of competition law. The meeting was chaired by Rana Jameel Ahmad Shahid of Fatima Sugar Mills. Those in attendance included representatives of Sheikhoo Sugar Mills, Tandlianwala Sugar Mills (Rehman Hajra Unit), Thal Industries Corporation, JK One Sugar Mills, Ashraf Sugar Mills, and Kashmir Sugar Mills, while Siraj Sugar Mills, Two Star Sugar Mills, and Haq Bahoo Sugar Mills participated online. Under Section 4 of the Competition Act, 2010, all forms of price fixing, collective business decisions, and collusion among competitors are prohibited. The CCP noted that sugarcane prices should naturally be set through individual negotiations between farmers and each mill, reflecting supply and demand dynamics. Instead, the mills unilaterally fixed the rate at Rs. 400 per 40 kg, leaving farmers with no room for negotiation. The CCP said that delaying crushing at the start of the season can restrict supply, encourage artificial shortages, and push up sugar prices for consumers. All ten mills have been ordered to submit written explanations within 14 days, detailing why enforcement action should not be taken for anti-competitive conduct and exploiting their market position. Chairman CCP Dr. Kabir Ahmed Sidhu warned that the commission will not allow any business group or industry association to form cartels or take collective commercial decisions that harm consumers. He said strict penalties will be imposed on entities found engaging in such behaviour.