Uttar Pradesh asks Centre to raise state’s sugar sale quota

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Lucknow | Published: December 26, 2018 12:59:05 AM

In a letter to food minister Ram Vilas Paswan, UP sugarcane and sugar development minister Suresh Rana states that the mills in the state produced 120.50 lakh tonnes of sugar and is still left with an unsold inventory of 9.61 lakh tonnes of the 2017-18 stock.

sugar, sugar industry, sugar import, sugar import duty, Indian production, India's sugar productionIn fact, the cane commissioner had written a letter pointing out the same issues to the food secretary last month and sought the Centre’s intervention.

Uttar Pradesh has asked the Centre to raise the state’s sugar sale quota and hike the minimum ex-factory sale price from Rs 2,900 per quintal to Rs 3,250, given that mills in the country’s largest producing state are still struggling to clear the last season’s cane dues of Rs 2,130 crore. In a letter to food minister Ram Vilas Paswan, UP sugarcane and sugar development minister Suresh Rana states that the mills in the state produced 120.50 lakh tonnes of sugar and is still left with an unsold inventory of 9.61 lakh tonnes of the 2017-18 stock.

“Apart from this, in the current season 2018-19, mills have already produced 21.74 lakh tonnes and the total production is estimated to be around 125 lakh tonnes,” he says, adding that after deducting the buffer stock and export quota, the state will still be left with 117 lakh tonnes of sugar. For this, the entire stock needs to be cleared in 12 months — from December 2018 to November 2019 — the state needs to have a monthly sugar sale quota of 11 lakh tonnes. Against this, the monthly sales quota fixed for UP has been 6.25 lakh tonnes for June, 5.48 lakh tonnes for July, 6.11 lakh tonnes for August, 6.83 lakh tonnes for September, 8.06 lakh tonnes for October and 7.67 lakh tonnes for November 2018. Due to the low sales quota, mills are unable to sell their sugar and repay the farmers on time, he said, adding that the problem is compounded by the fact that the ex-factory price of sugar has been fixed at a paltry Rs 2,900/quintal.

“We, therefore, implore the Centre to provide immediate relief in the form of increasing the state sugar sale quota to 11 lakh tonnes and hike the floor ex-factory sugar sale price from Rs 2,900/quintal to at least Rs 3,250/quintal in the larger interest of the industry and cane farmers,” he wrote. Speaking to FE, cane commissioner Sanjay Bhoosreddy said these steps will infuse some liquidity into the sector and help clear cane dues. Despite the efforts by the cane department to help clear last season’s dues, the mills have been unable to even start paying for the current season’s cane price.

In fact, the cane commissioner had written a letter pointing out the same issues to the food secretary last month and sought the Centre’s intervention. But with no help coming in, the minister has written a fresh letter to draw the Centre’s attention on the vexed issue. It may be mentioned that the state government is rather jittery over the delay in cane payments, as it fears that the crisis will aggravate in the coming months. And with general elections round the corner, the issue is likely to become pivotal not only for the farmers but also act as fodder for the opposition parties, especially as the BJP government had promised in its manifesto that it will ensure cane payments are made within the mandated 14 days.

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