UP sugar mills on war path with state government

The state sugar commissioner has fixed the dates for meetings to reserve the sugarcane area for mills in the upcoming crushing season. But the Uttar Pradesh Sugar Millers Association has written to him expressing its inability to attend the meeting.

sugar, sugarcane, sugar industry
As on August 31, cane arrears stood at over Rs 10,000 crore.

The Yogi Adityanath government and the sugar millers in Uttar Pradesh are all set to cross swords in the coming sugar season that is to begin from October.

Even as the commissioner (sugar and cane) in Uttar Pradesh, Sanjay Bhoosreddy, has fixed the dates for reservation meetings to reserve the sugarcane area for sugar mills in the upcoming crushing season 2018-19 from September 11-22 – in which all sugar mill representatives are expected to be present to put forth their views – the Uttar Pradesh Sugar Millers Association has written to him expressing their inability to take part in the meeting.

Stating their point, the sugar millers who have unanimously decided to boycott the meetings say that they have been requesting the state government to address the pressing issues and extend adequate financial support to enable them to undertake crushing operations in the next season.

Saying that they have already communicated to the government their inability to participate in activities related to the sugar season 2018-19, the letter says, the millers have urged the state government to work out a logical and economically-sustainable cane price based on a revenue-sharing model in addition to financial assistance to clear the cane price arrears for 2017-18, which the industry is “unable to clear as it is much beyond our capacity to pay.”

It may be mentioned that the state government had, in its supplementary budget last week, allocated a sum of Rs 5,535 crore for payments of outstanding cane price. Out of this allocated budget, a soft loan of Rs 4,000 crore is to be given to private sugar mills for balance cane price payments. The sugar mills will be given loan equivalent to the amount of outstanding cane price payments, which will be directly paid into the accounts of sugarcane farmers against their balance cane price arrears.

The mills have also been allocated Rs 500 crore as financial assistance @ Rs 4.50 per quintal of cane purchased by them. For those sugar mills that have cleared all the cane dues, this amount will be made available to the them by calculating @ Rs 4.50 per quintal.

However, the industry feels that this amount is inadequate and it will not help the industry either in clearing off their dues or in helping them get the mills ready for the next season, which is expected to be worse than the one that has just ended because the sugar production is likely to far exceed this year’s production of over 12 million tonne. As on August 31, cane arrears stood at over Rs 10,000 crore.

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