With sugar prices sliding and the arrears of cane growers piling up, millers in Uttar Pradesh have approached chief minister Yogi Adityanath, seeking immediate measures to save the industry.
With sugar prices sliding and the arrears of cane growers piling up, millers in Uttar Pradesh have approached chief minister Yogi Adityanath, seeking immediate measures to save the industry. The UP Sugar Millers Association (UPSMA) has suggested bridging the gap between the state advisory price and the paying capacity of the sugar mills by providing a cash assistance of Rs 40 per quintal directly to the farmers. Other measures suggested by the UPSMA include: creating a buffer stock of sugar similar to the one in Maharashtra at Rs 3,400 per quintal, having a two-tier cane price paying system due to non-availability of adequate working capital and constituting a committee to prepare a framework towards adopting a revenue sharing formula for pricing of sugarcane. Cane arrears have already touched Rs 8,000 crore. With more than a month to go before the sugar season ends, all the stakeholders— the farmers, mills as well as state government — are bracing to be singed with the prospect of the arrears rising further in the coming weeks. According to the latest data from the UP Cane Commissioner’s office, as on April 3, mills in UP were supposed to pay Rs 26,176.84 crore within the stipulated 14 days of taking cane delivery.
Against this, they have paid only Rs 18,193.59 crore and the overdue amount now stands at Rs 7,983.35 crore. Stating that the cane price fixed by the UP government is the highest in the country, UPSMA president CB Patodia said that cane arrears in the state are double than that of Maharashtra and Karnataka. “This is the direct consequence of the eroded cane paying capacity of the mills,” he said, adding that on expenditure side, the cane and allied expenses are very high and on the revenue side, sugar prices are very depressed. “With very high sugar production massively depressed sugar prices and considering the fact that we are far away from the ports, it has now become a question of survival for a large number of sugar companies in the state, which would, in the long run, severely impact the sugarcane farmers,” he has written. Urging the state government to “save this important and largest industry in the state, which not only contributes to the 44 lakh farmers and their family members and provides employment to over 5 lakh workers in the factories, but also contributes over Rs 20,000 crore to the state exchequer by way of taxes and duties”, he said that while the Central government had in July last year advised the state government to adopt the revenue sharing formula in UP, the state government has ignored the same and went ahead with a further increase in SAP for the current season.