Pune: As sugarcane price arrears have started mounting in Maharashtra, the sugar industry in the state has demanded a package of Rs 500 crore to clear the legally binding fair and remunerative price (FRP) payments for the ongoing 2018-19 crushing season.
Pune: As sugarcane price arrears have started mounting in Maharashtra, the sugar industry in the state has demanded a package of Rs 500 crore to clear the legally binding fair and remunerative price (FRP) payments for the ongoing 2018-19 crushing season.
Declining domestic sugar prices coupled with slower pace of exports are likely to increase the arrears and add to the simmering farm distress in the country, according to industry executives and experts.
“Not only the prices have declined but there seems no scope that they will improve in future,” said former agriculture minister Sharad Pawar, who heads the Vasantdada Sugar Institute.
“With production cost of Rs 34 per kg, mills from Maharashtra have been bearing losses of Rs 4 per kg, which has made it difficult to pay the FRP to farmers.”
Pawar has demanded that on the lines of the relief packages announced by the state governments of Uttar Pradesh, Punjab and Haryana, Maharashtra extend help of Rs 500 crore to sugar mills in the state for FRP payments.
Maharashtra chief minister Devendra Fadnavis said that he has already requested the Central government to increase the ex-mill minimum support price (MSP) of sugar to Rs 31 per kg from Rs 29 per kg. “To ensure that farmers get FRP for cane, we will back the industry in every possible way,” he said.
However, given that 2019 is an election year, when the central government may not like to invite the wrath of urban consumers by helping increase sugar prices, the sugar industry is demanding that the MSP be raised to at least Rs 30 per kg. “As per the legal provision, which links MSP to the FRP, the present MSP of sugar should increase Rs 66 per quintal as the FRP has increased in 2018-19. Thus, the new MSP should be Rs 2,966 per quintal, which can be rounded off to Rs 3,000 per quintal,” said an executive,who did not wish to be identified.
Declining domestic sugar prices coupled with slower pace of exports are likely to increase the arrears and add to the simmering farm distress in the country, according to industry executives and experts.
“Not only the prices have declined but there seems no scope that they will improve in future,” said former agriculture minister Sharad Pawar, who heads the Vasantdada Sugar Institute.
“With production cost of Rs 34 per kg, mills from Maharashtra have been bearing losses of Rs 4 per kg, which has made it difficult to pay the FRP to farmers.”
Pawar has demanded that on the lines of the relief packages announced by the state governments of Uttar Pradesh, Punjab and Haryana, Maharashtra extend help of Rs 500 crore to sugar mills in the state for FRP payments.
Maharashtra chief minister Devendra Fadnavis said that he has already requested the Central government to increase the ex-mill minimum support price (MSP) of sugar to Rs 31 per kg from Rs 29 per kg. “To ensure that farmers get FRP for cane, we will back the industry in every possible way,” he said.
However, given that 2019 is an election year, when the central government may not like to invite the wrath of urban consumers by helping increase sugar prices, the sugar industry is demanding that the MSP be raised to at least Rs 30 per kg. “As per the legal provision, which links MSP to the FRP, the present MSP of sugar should increase Rs 66 per quintal as the FRP has increased in 2018-19. Thus, the new MSP should be Rs 2,966 per quintal, which can be rounded off to Rs 3,000 per quintal,” said an executive,who did not wish to be identified.