Maharashtra gets Governor’s nod to start sugar season from Nov 22

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Published: November 20, 2019 12:50:30 AM

Maharashtra sugar commissioner Shekhar Gaikwad had recommended that crushing may begin on November 25 but Koshiyari advanced the date by three days after he held a meeting with sugar millers.

Maharashtra, Governor, sugar season, sugarcane, sugar mill, sugar price,sugar productionDuring the meeting, sugar mill owners sought a reduction in their contribution to the Chief Minister’s Relief Fund, he said. 

Maharashtra’s sugar season will commence from November 22 with governor BS Koshiyari on Tuesday giving the green signal for start of cane crushing. Due to the President’s rule in the state, this is probably the first time that the decision on the commencement of the crushing season has been taken by the governor.

Maharashtra sugar commissioner Shekhar Gaikwad had recommended that crushing may begin on November 25 but Koshiyari advanced the date by three days after he held a meeting with sugar millers.

The season is already delayed by a month due to unseasonal rains which flooded cane fields. It is expected to last 70-90 days against the average of 120 days.

In view of government guarantees and share capital given to sugar factories, the governor has also approved that 50% per quintal should be tagged and given back as recovery to the government, the commissioner said.

Sanjay Khatal, MD, Maharashtra State Cooperative Sugar Factories Federation, who was present for the meeting, said that several demands were placed before the government including restructuring of millers’ loans.

Khatal pointed out that banks have expressed their inability to fund pre-seasonal loans to sugar factories on the grounds that the sectoral exposure limit was over. Applications of 70-75 factories for pre-seasonal loans have not been approved, he said. Millers have also sought Rs 350 per tonne as recovery due to the losses caused because of rains. The governor suggested that these issues should be placed before ministers after the new government is formed in the state, he said.

During the meeting, sugar mill owners sought a reduction in their contribution to the Chief Minister’s Relief Fund, he said. One of the main sources of cash flow for the CM’s Relief Fund is a Rs 4 cess on every quintal of sugarcane crushed by sugar factories. The cess generates Rs 25 crore every year. However, with sugar factories themselves facing distress, their contributions have been slow in coming.

As per government estimates, a 45% fall in sugar output is on the cards. The drought in Marathwada last year and floods in the sugar belt of western Maharashtra in July-August led to a drop from 107 lakh tonne last year to 58 lakh tonne this year.

Gaikwad, in a presentation made before the governor, stated that the sugar stock in hand is currently to the tune of 70 lakh tonne. The state needs around 35 lakh tonne for domestic consumption, he added.

This season, cane grown on 8.32 lakh hectare is expected to be crushed to produce 58.23 lakh tonne of the sweetener. Gaikwad estimated that 162 mills would crush 570 lakh tonne cane. Last season, 195 mills crushed 952.60 lakh tonne cane, producing 107.1 lakh tonne of sugar, the maximum amount ever produced in Maharashtra.

Meanwhile the Western India Sugar Millers Association ( WISMA) has sent a protest letter to the government questioning why they were not invited to the meeting between millers, officials and governor. WISMA president BB Thombare pointed out that no invite was sent to the association and they were told that a protocol is to be followed for a meeting with the governor.

WISMA has been part of such meetings for the last four years and private mills contribute 50% to the state’s sugar output, he said.

Farmer groups are demanding a hike in the price paid to them by millers. The fair and remunerative price (FRP) is Rs 2,750 per tonne and we are seeking compensation over and above the FRP as farmers have suffered losses due to floods, said Swabhimaani Shetkari Sanghtana (SSS) founder Raju Shetti.

The sugar industry is demanding that factories be allowed to pay the government-controlled FRP in three instalments, a request rejected by the SSS that is not letting crushing operations begin in Kolhapur. Khatal said that farmer bodies and farmers should take a lenient view since the industry is in financial distress.

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