Sri Lanka’s state-run sugar factories are facing a severe crisis as unsold sugar stocks continue to pile up amid plunging demand. The situation has escalated to the point where paying salaries to employees of certain government-owned sugar manufacturing institutions has become increasingly difficult.
According to sources, several ministers have personally reached out to major retail chains and large-scale buyers across the country, urging them to purchase the government’s surplus brown sugar. Despite these appeals, many trading companies have declined, citing high prices as the main concern, especially when cheaper imported white sugar remains readily available in the market.
The reluctance of buyers to accept higher-priced government sugar has left authorities in a bind, unable to offload accumulated inventory or generate much-needed cash flow. With no viable pricing strategy and private traders prioritizing profit margins, the state is now caught in a growing financial squeeze with few immediate solutions.
This sugar surplus crisis adds to a broader pattern of inefficiencies in the state-run manufacturing sector, where mismatched pricing and market realities continue to hinder operations and sustainability.
