With no solution in sight on the issue of arrears of Fair and Remunerative Price (FRP), the chorus among sugar millers in Maharashtra for a minimum support price (MSP) for sugar is growing louder.
Sugar millers in Maharashtra have sought a Minimum Support Price of Rs 30 per kg from the government. The demand was placed by cooperative millers during a meeting of the Cane Control Board in Mumbai.
Jayprakash Dandegaonkar, vice chairman, Maharashtra State Cooperative Sugar Factories Federation (MSCSFF) said that there has been no record of pending FRP arrears for a long time in the state.
“Prices are on the lower side and the factories are unable to meet even the cost of production. When a mill has to take a loan for even procuring raw material, it signals the end of the industry. Not only Maharashtra but other cane growing states are also fighting for survival. Unless there is a government intervention, there is no hope for the industry,” he told FE.
Dandegaonkar pointed out that the country’s requirement is around 240 lakh tonnes and the surplus over and above should be purchased by the government at the MSP either for export or domestic consumption.
According to Dandegaonkar, sugar has been a highly regulated issue with the Centre and states taking almost all decisions with regard to price, FRP, purchase and other taxes, ethanol pricing among others.
The total taxes (direct and indirect) amount to Rs 300-Rs 350 per tonne, Therefore the government should come forward and resolve issues in a highly volatile market, he said. “The total production cost of sugar is currently at R30 per kg and mills are selling the sugar for Rs 22 per kg.
Short margins have touched Rs 25,030 crore and almost every mill has been facing losses to the tune of R8 crore. We are not seeking loans or grants from the government. A MSP should resolve the issue since the industry will be assured of a price and will be in a position to make payments,” he explained.
The demand is expected to be discussed at the Mantri Samiti baithak which is likely to be held soon. Interestingly, the Cane Control Board was formed by the previous Congress-NCP government to resolve issues related to pricing in the state. The board is headed by the state chief secretary and 14 non government members including farmer organisations, cooperative mills and private mills.