Govt may substantially jack up support price to cane growers

LUCKNOW: Sugarcane growers may hope for a better deal this year, as the government is mulling fixing the state advised price (SAP) at around Rs
180 to Rs 190 per quintal for the late and early maturing varieties of the sugarcane respectively. A final decision is likely to be taken in this regard by mid-October.

The step is being mooted to rejuvenate the sugar sector which is passing though a difficult phase due to poor availability of sugarcane in the state. Crushing seasons which usually go on for 150-180 days in this sugar-surplus state, are now reduced to merely 90-120 days. As a result, there has been substantial fall in the sugar production in the state. The situation is likely to aggravate this year due to emerging trend of sugarcane crop diversion.

In the backdrop of this, price increase is being favoured widely to win back the trust and economic interest of over 35 lakh cane growers in the state. The cause of worry is the shrinking area under sugar and constant decline in the sugarcane production. Sources within the government thus confide that this is why there is proposal under consideration to increase the SAP at least by Rs 40 to Rs 50 per quintal.

Undoubtedly, mill owners too are not averse to price increase, but they want the SAP not beyond Rs 160 per quintal. As put it by GSC Rao, president, Sugar Technical Association of India (STAI): "Any arbitrary increase in cane price by the government will have an adverse impact on cane growers in time of overproduction of sugarcane." So the pricing should be done as a balancing act between the interest of the mill owners and cane growers.

Contrary to this, farmers in general want SAP to be fixed not less than at Rs 200 per quintal. This is because the recovery of sugar is around 9 kg per quintal. The sugar is sold at present around Rs 36 per kg. So the cost of total sugar produced from one quintal of sugarcane is well around Rs 350. Apart from this, the profit made from byproducts like bagass, molasses and ethanol etc is in addition to that of sugar price. "If clubbed together, the profit made by mill owners comes around Rs 550 from one quintal of the sugarcane," quipped Shivshanker, a farmer from Faizabad. However, the farmers were given only a pittance, he rued.

Notably, the concern over the issue has also been expressed by the government as well as capatins of sugar industry. At a seminar Sugar Tech-2009 organised by the CII in association with two apex institutions -- the National Sugar Institute, Kanpur and the Indian Institute of Technology (IIT) Roorkee -- experts underline the need for revisiting the sugar sectors from a new perspective to understand the challenges and identify the opportunities.

Speaking on the occasion, chief secretary Atul Kumar Gupta said that the mill owners were to share the blame for the prevailing mess in the sugar sector because the track record of payment by many of them had betrayed the trust of farmers. The result of this was that the canegrowers were looking for a greener pasture by shifting away from cane cultivation to paddy and other crops. So, the challenge before mill owners was to win back the trust of cane growers and work in tandem with them for the uplift of the sugar sector as a whole, he said.

In his remark, RL Yadav, director, Indian Institute of Sugar Research (IISR) said that sugar pricing should be fixed at the time of showing rather than at the time of crushing season. In order to sustain the interest of cane growers, he said, they should be paid 50% of their price in advance and the remaining at the time of crushing. Besides, they should also be given insurance cover, he said, adding that this kind of system was also in force in many states.

Summing up, cane commissioner Sudhir M Bobde said that he would strive to prepare a roadmap for the development of sugar sector in the state. He said mill owners should take measure against the weighing anomalies, which he said was a cause of major harassment for farmers in the state.

Nearly 130 delegates from all over the country attended the seminar. They included Ramesh Suri, Chairman, CII, Tarun Swahney, Chairman, agri-sub committee, CII and Jayant Krishna, vice-chairman, CII.

source: toi