Alcohol Exports Bring $220 Million To Pakistan

Pakistan earned $220mn on export of 0.3mn tonnes of alcohol up to October 31 while another 50,000 tonnes of alcohol is expected to be exported during the November-December period.

Pakistan, where alcohol consumption by Muslims is banned by law, produced 2.6mn tonnes of molasses during the 2007-08 sugarcane crushing season and on adding 50,000 tons of carry-over stocks at terminals and an equal quantity at the mills, the total available stocks of molasses stood at 2.761mn tonnes.

Industry and export sources say since conversion ratio of molasses to alcohol stands at 5:1 (five tonnes of molasses required to produce one tonne of alcohol), the estimated requirement of distilleries stood at 1.65mn tonnes for molasses.

The sources said alcohol prices in the world market remained on the upper side during 2008 which enabled Islamabad to earn more foreign exchange through exports. After touching around $800 per tonne, alcohol prices receded back to $600 per tonne.

Consequently, on exporting around 312,000 tonnes up to October 31, 2008, at an average price of $725 per tonne, Pakistan managed to earn around $220mn through export of alcohol.
According to industry sources, the country exported 190,585 tonnes of alcohol last year (2006-07) and earned $112mn at an average price $550 per tonne.

“With the advent of each sugarcane crushing season, Pakistan had been exporting millions of tonnes of molasses at throwaway prices to European countries and Japan,” Kasim Hashim, the chairman of the Terminal Association of Pakistan, said. However, for the last several years it is being converted into three grades of alcohol – fuel or anhydrous, neutral or extra neutral and industrial or rectified ethanol Hashim said presently 16 distilleries are operating in Pakistan at 60% capacity although as more and more distilleries are coming up every year, there has been a constant rise in export of alcohol.

During 2004, Pakistan exported 99,711 tonnes of alcohol, but in the subsequent year, the figure jumped to 122,104 tonnes. After exporting around 255,812 tonnes last year (2007), Pakistan is now poised to export a record volume of 350,000 tonnes of alcohol this year (2008), he maintained. He said around 9,000 tonnes of alcohol had been exported this year through ISO containers which were the latest method for haulage of liquid cargo.

Hashim said that ISO containers/tank are filled with alcohol from distilleries and loaded on trailers for direct loading on to ships. These tanks are air-tight and expensive because they are first cleaned by steam and are used only after survey is carried out. The industry is encouraging use of ISO tanks because they are fast for haulage of liquid cargo and are also easy to handle.
Presently they are mostly reaching Dubai, but in coming years will encourage their use for Middle East and Africa, he added.

Export of alcohol is being hindered by congestion at the Karachi Port where tanker ships have to wait for their turn for several days, resulting in heavy demurrage charges. This is also draining out valuable foreign exchange because demurrage is paid in dollars, TAP Secretary Sultan Ahmed said.

Source: Gulf Times

14 thoughts on “Alcohol Exports Bring $220 Million To Pakistan”

  1. @ Hend: I agree that drinking of alcohol (except for medical purposes) should be totally banned. I have seen how some of my relatives suffered because of it (it was once openly available in Pakistan).

  2. SL

    Absolutely not.

    Islam is against alcohol consumption by people, the use in cars and machines was not envisaged when Quran was revealed. Therefore you have to go by the true spirit in which these guidences are issued.

  3. @ Hend: Most alcohol is used for industrial and pharmaceutical purposes. Ethanol (a form of alcohol) is already being used to drive cars. Should an Islamic country ban the use of ethanol in vehicles just because it’s alchohol?

  4. Mohamed, Muslim

    Very forthright views from you in explaining that opportunism does not justify export of alcohol by an Islamic country.


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