Even as private sugar mill owners have refused to start crushing this session unless the State Advisory Price was reduced, the Uttar Pradesh government is all set to announce SAP hinting benefit for the farmers and the industry.
A senior official told The Pioneer that the government is doing a tight rope walk and would announce sops for the farmers as well as the mill owners. “The government will protect the interest of all the players in the sector,” the official said.
Chief Secretary Alok Ranjan met a delegation of cane farmers and sugar mill owners separately and said that the SAP would be decided after taking care of the interest of farmers and sugar millers alike.
The state government has not increased SAP for last two years which stands at Rs 280 per quintal. The private mill owners are on the other hand demanding cut in this price saying this SAP was “no longer viable”.
Ranjan told The Pioneer that cane crushing season would start by November 15 next. Two private sugar mills are likely to start their crushing by next week while others would start from November 20. “I had a very positive discussion with farmers and private mill owners recently. I hope there would not be any problem in crushing this year,” he said.
Rajan said that in last season the cane production was 65 tonne per hectare which is more than the last year though it is less than national average which stands at 70 tonnes per hectare. last year the cane production average was 57 tonne per hectare.
He also stressed the need for increasing the recovery percentage which is 9.56 per cent.
The statement of Chief Secretary belies the confidence of private sugar mill owners. The Uttar Pradesh Sugar Mills Association said that millers in UP are made to pay Rs 280 per quintal which is very high considering the market situation.
“The UP Mills can pay at the rate of Rs 180 per quintal in the next season and the rest amount , which the millers are forced to pay, should be bridged by the central government,” a senior official of the association said.
He said that situation is very bad because this is the fifth continuous year of surplus sugar production. It is estimated that sugar stock in 2015-16 would be over 103 lakh ton – the highest ever in the annals of India.
“The UP Government has increased State Advisory Cane Price (SAP) by 100 per cent within a period of seven year. It was Rs 140 per quintal in 2008-09 and now it is Rs 280. On the other hand the price announced by central government is Rs 220,’ it said.
It further added that sugar cane price is totally dependant on revenue realization from sugar. Considering recommendations of different committees the mills can afford to pay just Rs 176.25 per quintal.
“The sugar mills are in no position to start their crushing operation at Rs 280 or Rs 220 per quintal,” the association said.