While production has been good, sugar sales have been a greater worry for mills, with most struggling to meet their monthly sales quota.
The 2020-21 sugar season in Maharashtra is in its last leg and is likely to end by May 15, top officials said. Sugar production has already touched 105 lakh tonne and is likely to reach 107 lakh tonne, Shekhar Gaikwad, state sugar commissioner, told FE.
Gaikwad said only 46 of 188 factories are still operational and workers of 142 factories have returned to their hometowns. So far, the state has crushed some 999.50 lakh tonne of sugarcane to produce 105 lakh tonne sugar with a recovery of 10.48%. Another 2 lakh tonne of cane is still available for crushing and this should be completed by the first fortnight of May, he said.
Most mills in Kolhapur and Sangli regions, which are considered the sugar bowls of the state, have ended their season. Majority of the mills in Pune and Satara have either ended their season or are in the last leg, officials said, adding that mills in the Marathwada region should be among the last to finish crushing by May. Despite high production, mills have been finding it difficult to pay farmers due to lack of demand for sugar.
According to the latest arrear report, factories still owe farmers Rs 2,073.05 crore in cane payments or fair and remunerative price (FRP) dues. Mills have so far paid Rs 19,286.65 crore, amounting to 90.29% of the total FRP payments this season. The total FRP payable to farmers is Rs 21,359.69 crore. The Sugar Commissionerate has taken action against 19 mills for their failure to make FRP payments. Revenue and recovery certificate orders have been issued to these 19 mills for attachment of their properties. The Sugarcane Control Order of 1966 mandates that mills pay the basic FRP within 14 days of purchase, failing which mills are to pay 15% interest per year. Failure of mills to do so allows the commissioner to recover the same as revenue dues by attaching and auctioning off their properties.
So far, around 87 factories have made 100% cane payments and nearly 101 factories still owe dues to farmers. While production has been good, sugar sales has been a greater worry for mills, with most struggling to meet their monthly sales quota. Most mills foresee working capital requirement problems in the next season with excess sugar on their hand.
Cooperative millers have therefore opposed the 22 lakh tonne of sugar sales quota given for April. With restrictions coming into place due to surge in Covid cases, millers said meeting the increased quota will be difficult and is likely to result in lapsed quotas. Jaiprakash Dandegoankar, president of the National Federation of Cooperative Sugar Factories, said restrictions have affected sale of sugar as consumption in hotels and restaurants has taken a hit and mills have been finding it difficult to meet their sales quota, resulting in a liquidity crisis.