At least 15 sugar mills in the Kolhapur division of Maharashtra have been issued notices by the deputy district registrar for their failure to pay fair and remunerative price (FRP) dues to farmers for the season of 2018-19, senior officials of the Maharashtra Sugar Commissionerate revealed.
According to the officials, millers have paid up only Rs 360.36 crore to farmers till December 15 and the total payable FRP was to the tune of Rs 2,497.41 crore by the end of November.
Maharashtra’s sugar season officially commenced on October 20 but a few mills were crushing then and the season began in full swing after Diwali in November.
Nearly two months have lapsed and as per the Cane Control Order, it is binding on the mills to make cane payments to farmers after 15 days from the start of crushing.
Millers, however, have been struggling to sell sugar with prices hovering around the minimum floor price (MFP) of `2,900 per quintal.
Sugar millers from Maharashtra have been seeking a financial package from the state government to pay their fair and remunerative price (FRP) dues to cane farmers on the lines of packages declared by the Uttar Pradesh, Haryana and Punjab governments.
Sharad Pawar, chairman of the Vasantdada Sugar Institute, at an event in Pune had sought a package of `500 crore from the state government.
According to Pawar, the state has seen bumper production because of which sugar prices are falling down. If this situation continues, it will be difficult for sugar factories to make payments to farmers, he had warned.
Sugar prices are in the range of `2,900 per quintal whereas the cost of production is `3,300 per quintal which means that farmers have to bear a loss of `400 per quintal, he had said. Therefore, instead of export subsidy or transport subsidy, the state government should come forward and help with a package to help pay FRP, he said.
Maharashtra Chief Minister Devendra Fadnavis, however, remained non-committal, stating that the government was sympathetic to the concerns of farmers and understood that the international market decides the prices.
He said the government would soon call for a meeting with representatives of sugar sector to take a midterm review and would do what was best for the industry.
He said he had written to the government, seeking a raise in the MFP of sugar to `3,100 per quintal. Millers however pointed out this may not be possible.
Mukesh Kuvediya, secretary general, Bombay Sugar Merchants Association, pointed out the demand was on the lower side because of winter and lesser demand for soft drinks and icecreams. Barring Christmas at the end of the month, there are no other festivals and since the government has released an adequate quota of 19.5 lakh tonne, the demand-supply situation has been maintained, he had said.
Millers in Maharashtra still owe farmers `77 crore in FRP payments for the last season of 2017-18. According to senior officials in the Maharashtra Sugar Commissionerate, some 27 revenue recovery certificate orders had been issued by the authorities of which 10 RRCs are still pending. Millers in Marathwada region have begun paying farmers in instalments since they are unable to make the payments in full at this point.
This sugar season of Maharashtra commenced with an opening stock of some 40 lakh tonne.
The state is expected to crush some 1,040 lakh tonne of cane and produce nearly 85-90 lakh tonne because of the drought situation and the impact of white grub disease. In Maharashtra, 178 sugar mills are in operation and have produced 29 lakh tonne till December 15, 2018, as per figures released by the Indian Sugar Mills Association (Isma).