It’s more than a month into the new sugar season in 2016-17, but sugar factories in Uttar Pradesh still owe farmers Rs 1,095.27 crore as cane dues for the previous 2015-16 season.
It’s more than a month into the new sugar season in 2016-17, but sugar factories in Uttar Pradesh still owe farmers Rs 1,095.27 crore as cane dues for the previous 2015-16 season. Out of this, 27 sugar mills belonging to five sugar companies, namely Modi Sugar, Mawana Sugars, Simbhaoli Sugars, Bajaj Hindusthan and Rana Sugar groups, owe almost Rs 929 crore as on November 25.
According to data culled by the department of sugar and sugarcane development, these five sugar firms are the main culprits which are bringing down the industry’s average payment of sugarcane dues for the last season.
While Modi Sugars’ two sugar factories are the worst defaulters, owing a whopping Rs 335.40 crore, the three factories of Simbhaoli Sugars owe Rs 210.17 crore. One sugar factory of Mawana Sugars owes Rs 161.88 crore, while the Bajaj group, too, which has 15 sugar factories in the state, owes Rs 136.19 crore and the Rana group’s four factories owe Rs 86.28 crore.
While these five groups’ dues total Rs 929 crore, some single units owe the remaining Rs 164 crore. However, when compared to last year’s scenario on the same date, when the sugar mills owed a total of Rs 2,703 crore, the situation looks better.
According to sources in the industry, the percentage of cane dues paid for the previous year stands at 94% paid as compared to 87% paid last year at the same time.
“The situation is slightly better this year owing primarily to the fact that sugar prices have been better this year as compared to last year. However, high sugar prices may not continue for very long and in the event of a drop in sugar prices, the cane price paying capacity would be adversely affected. The need of the hour, therefore, is a revenue-sharing model. That would be in interest of both farmers and the industry,” an insider said, requesting anonymity.
The Siddharth Shriram-promoted Mawana Sugars, which had recently sold its Titawi Sugar in UP for Rs 375 crore to Indian Potash, has been able to dramatically bring down its dues from the whopping Rs 310 crore as on November 2 this year to Rs 161.88 crore on November 25. “The company has pumped in almost Rs 150 crore towards settlement of sugarcane farmers’ dues from the sale proceeds of Titawi,” a source said.