Sugar production in the just concluded 2018-19 cane crushing season in Uttar Pradesh fell marginally to 11.82 million tons (MT). The sugar output fell nearly 1.9 per cent compared to the production of over 12 MT in the 2017-18 crushing season.
Better sugar recovery, however, saved the day for the sugar industry which partly made up for low crushing of cane by mills this season. Although net cane purchase by all 119 sugar mills in UP fell by 7.25 per cent, yet sugar output dipped by a much lower ratio of 1.9 per cent compared to last year.
Interestingly, sugar production in the state this season was earlier pegged at a much higher level of 12.4 MT due to estimates of higher cane acreage of 2.8 million hectares.
Meanwhile, state mills, especially private ones, are saddled with high arrears worth Rs 10,000 crore. Against total payables of about Rs 33,025 crore for 2018-19 season, mills have collectively paid nearly Rs 23,000 crore so far with the remaining yet to be cleared.
In November 2018, the state government had kept cane price for common variety unchanged at Rs 315 per quintal, thus providing relief to mills amid falling sugar exports, stockpile, mounting arrears and subdued market prices.
Recently, Chief Minister Yogi Adityanath had asked private mills to settle farmers’ dues by August, 2019 and had warned that any further delay would not be tolerated. The payments ratio of government-controlled cooperative mills stands at 85 per cent and that of private units at 70 per cent.
This season, 119 sugar mills, including 94 private, 24 cooperative and a UP State Sugar Corporation unit, had participated in cane crushing.
Last year, the state had even floated a soft loan scheme for those private mills whose payments ratio stood at more than 30 per cent in 2017-18 season. Later, eligible mills were sanctioned soft loans amounting to nearly Rs 2,900 crore.
“Payments would improve in coming days as crushing season is now over and there would be no fresh addition to outstanding amount. Deputy Cane Commissioners have already been directed to prepare a roadmap for ensuring farmers’ payments,” official sources said.