Maharashtra millers pay Rs 6,000 crore in cane FRP dues to farmers

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Published: February 22, 2019 12:10:20 AM

The threat of action by the Maharashtra sugar commissionerate to seize sugar stocks from factories has resulted in millers loosening their purse strings and releasing nearly Rs 2,000 crore in fair and remunerative price (FRP) payments to farmers in the last week, top officials of the sugar commissionerate said.

Maharashtra millers pay Rs 6k cr in cane FRP dues to farmersMaharashtra millers pay Rs 6k cr in cane FRP dues to farmers

The threat of action by the Maharashtra sugar commissionerate to seize sugar stocks from factories has resulted in millers loosening their purse strings and releasing nearly Rs 2,000 crore in fair and remunerative price (FRP) payments to farmers in the last week, top officials of the sugar commissionerate said.

During February, factories in the state have paid `5,915 crore (nearly `6,000 crore till date) in cane payments after the Commissionerate issued Revenue and Recovery Certificate (RRC) action notices to 45 factories, threatening to seize their stocks.

Maharashtra sugar commissioner Shekhar Gaikwad told FE that around `4,600 crore remained in FRP arrears. “The estimated dues for the month were `7,900 crore and against that the actual arrear figure has come down to `4,600 crore which means we are on the positive side,” he said.

Till date, around 192 factories in the state have crushed 787.94 lakh tonne and the total sugar production so far is 866.53 lakh quintals. Some 17 mills in the state have entered into agreements with farmers for the delayed payment of FRP. The total arrears accordingly were `15,605 crore. However, farmer outfits in the state resorted to agitations on delayed payments, following which RRC notices were issued to 45 mills. Around 20 mills have made 100% payment of FRP, 44 mills have made 80-90% payments, 61 mills have made 60-79%, 42 mills have made 40-59% and 19 mills have made 20% cane payments.

Six factories hadn’t made any payments. Sugar commissioner Shekhar Gaikwad is hopeful the cane dues would fall below 10% by March-end.

Some of the mills in Kolhapur region were deducting `130 per tonne from cane payments from farmers stating that they were yet to receive the export subsidy dues from the Centre. The commissioner then sought a written clarification from the state which clearly states that the dues have nothing to do with the cane payments.

Gaikwad told mills that they were not supposed to deduct export dues from farmer’s cane payments.

Millers are hopeful the rise in sugar valuations by the Maharashtra State Cooperative Bank would help mills overcome the issue of short margins which have arisen because of the fall in international prices and prevailing market prices.

The bank has increased valuations to `3,100 per quintal. Several mills have begun floating tenders but the market response continues to be tepid. The state’s sugar season is coming to an end and is expected to end in a month. Mills in the Marathwada region would shut operations soon. The season is expected to end by April 15.

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