SBP Revises Sugar Export Rules: Punjab and Sindh Mills Can Ship, Khyber Pakhtunkhwa Waits
SBP revised its sugar export instructions on 13 October 2026: Punjab and Sindh mills may ship by sea against a sight letter of credit. Read what banks must do.
Short answer: On 13 October 2026 the State Bank of Pakistan told banks that sugar mills in Punjab and Sindh may export under their revised quotas, by sea only, against a sight letter of credit or advance payment. Banks must not handle Khyber Pakhtunkhwa mills until SBP confirms a federal endorsement.
A sugar mill that wants to ship abroad cannot just load a vessel. The money has to pass through an authorised dealer, which is a bank allowed to handle foreign exchange. That bank follows SBP instructions line by line. On 13 October SBP changed those instructions for the 200,000 tonne sugar export, and the change affects three provinces differently.
We read the circular on the State Bank's own circulars page on 14 October 2026. It is EPD Circular Letter No. 15 of 2026, signed by Director Dr. Asif Ali, and it is addressed to the heads of all authorised dealers. The mill-wise quota figures sit in its enclosures, and we could not see those.
SBP revised its sugar export instructions on 13 October
EPD Circular Letter No. 15 of 2026, dated 13 October, replaces the earlier instructions in Circular Letter No. 14 of 2 October. It follows a federal food security ministry memorandum of 9 October that carried revised province and mill wise quotas for the 200,000 tonne export.
The circular lists the paper trail. The ministry memorandum is numbered 19(12)/EXPORT/PED/API-0005. It relied on a letter from the Pakistan Sugar Mills Association dated 3 October with the revised quotas. A second association letter dated 8 October corrected the names of three sugar mills.
In plain words, the quota list changed and then had a spelling fix. The State Bank issued new rules so that banks work from the updated list. If you export sugar or finance a mill, treat the 2 October letter as replaced.
Punjab and Sindh mills can export, Khyber Pakhtunkhwa cannot yet
SBP says the Punjab and Sindh governments have endorsed the revised quotas, so banks may process export transactions for eligible mills in those two provinces. For Khyber Pakhtunkhwa, endorsement is still pending, so banks must wait until SBP confirms it has received the ministry's endorsement.
That split matters for a mill owner. A Punjab mill with a place on the list can start talking to its bank about a sale. A mill in Khyber Pakhtunkhwa cannot, even if its name is on the list. The circular says SBP will tell banks when the endorsement arrives.
We do not know when that will happen. The circular gives no date. Mills in that province should ask their bank and the provincial food department, not guess.
| Province | What the circular says |
|---|---|
| Punjab | Endorsed. Banks may process exports for eligible mills under revised quotas |
| Sindh | Endorsed. Banks may process exports for eligible mills under revised quotas |
| Khyber Pakhtunkhwa | Endorsement pending. Banks must not process until SBP confirms |
Five conditions apply to every Punjab and Sindh export
The circular sets five conditions. Exports must be against a sight letter of credit or advance payment. Shipment must be by sea only. There is no shipment deadline. Proceeds must come home within the period SBP already prescribes. Banks must report weekly.
A sight letter of credit is a bank promise to pay the seller as soon as the right documents are shown. Advance payment means the buyer pays before the sugar leaves. Both protect the exporter from a buyer who takes the goods and does not pay.
- Payment must come by sight letter of credit or by advance payment.
- The sugar must travel by sea. Road and rail shipments do not qualify.
- The circular sets no last date for shipment.
- Export proceeds under letters of credit must be realised within the regulatory period SBP prescribes. The circular does not repeat that period.
- Banks must send export and shipment updates every week in the Annexure A format.
The sea only rule is the one to watch. A mill that planned to send sugar by road or rail to a neighbouring market cannot do so under this circular. The bank will not process it.
Banks must check the client and report every Friday
Authorised dealers must verify that the client and the underlying transaction are genuine, and must follow the ministry memorandum. They must send sugar export transactions and shipment updates every week, by 4 pm each Friday, to the foreign exchange department of SBP at a dedicated email address.
This weekly report is how the State Bank watches the quota. It can see what has been sold, what has been shipped and where the money stands. A bank that is slow to report is a bank that has not followed its instructions.
For exporters, the practical result is more paperwork at the bank counter. Keep the letter of credit, the shipping documents and the quota allocation together. The bank will ask for them.
What this means for sugar prices at home
The circular is about foreign exchange procedure and does not mention retail prices. Exports remove sugar from the local market, so people watch prices. We cannot say from this circular whether prices will move, and we will not guess.
What we can say is where prices stood in our last check of the official weekly sheet. We reported sugar at Rs 143 a kilo on 8 October, 22 percent below a year earlier. The earlier decision to allow the 200,000 tonne export is covered in our report on the cabinet committee approval. The latest weekly figure is in the sugar price report for 8 October.
If you buy sugar for a shop or a wedding, check the city price list rather than a rumour. Our city by city price comparison shows how far one kilo can differ between Lahore and Quetta.
Questions about the sugar export circular
What did SBP change on 13 October 2026?
SBP issued revised instructions for the export of 200,000 tonnes of sugar. They replace the 2 October letter and reflect new mill wise quotas sent by the food security ministry on 9 October.
Can Khyber Pakhtunkhwa mills export sugar now?
Not yet through banks. The circular says banks must not process their transactions until SBP confirms the ministry's endorsement has been received.
Can sugar be exported by road?
Not under this circular. It says shipment must be by sea only for Punjab and Sindh mills.
Is there a deadline to ship?
No. The circular states that there is no shipment deadline. Bank reporting, however, is due every Friday by 4 pm.
How do mills get paid?
Payment must come through a sight letter of credit or advance payment. Proceeds must reach Pakistan within the period SBP already prescribes.
How we verified this
What we checked, where we read it, and what we could not confirm.
Last checked on 14 October 2026, Pakistan time. We read SBP's EPD Circular Letter No. 15 of 2026 on its circulars page. We did not see the enclosed mill wise quotas or Annexure A, and the circular does not give the period for realising export proceeds. We have not seen the ministry memorandum itself.
About the author
Public Services and Education Journalist
Fajr Riaz is a journalist and content writer at Pakistan Era, based in Lahore. She covers the questions people meet in everyday life in Pakistan: how a public service works, what a change in the rules means, and where to find a reliable answer.
