Sugarcane dues: Maharashtra growers protest, demand full payment

Even as some mills have started complying with govt's 80:20 formula, the farmer bodies are demanding interest on the 80% FRP being paid

The sugar industry and farmers’ bodies in Maharashtra are pitted against each other on payment for procurement of cane for the ongoing crushing season.

The state government recently issued oral instructions for mills to first pay 80 per cent of the ‘Fair and Remunerative Price’ (fixed by the government, not the market) and the balance 20 per cent later. However, Swabhimani Shetkari Sanghatana and other farmer bodies have launched an agitation to demand full payment without delay. They note the price of sugar is Rs 2,600-2,700 a quintal, from Rs 2,200-2,300 a qtl last year.

Farmers Action Committee convenor Satish Kakde told Business Standard the government’s 80:20 formula had no legal sanctity. If mills did pay only 80 per cent first, they’d have to also pay interest on the delayed payment.
 

Some mills, especially from western Maharashtra, have begun the FRP payment, paying Rs 1,800 to Rs 2,200 a tonne. However, mills from drought-hit Marathwada, Vidarbha and north Maharashtra are struggling to comply with the government order. FRP for this season has been fixed at Rs 2,300 a tonne for 9.5 per cent recovery, compared to Rs 2,200 a tonne for the 2014-15 season.

So far, 90 cooperative and 72 private mills have so far produced 2.71 million tonnes of sugar, crushing 26.6 mt of cane. State production is expected to be 8.4 mt, from 10.4 mt last year.

Cooperatives minister Chandrakant Patil said he hoped the mills would first pay 80 per cent of the FRP to growers. Actio, he said would be taken against those which didn’t. Of Rs 20,000-crore of payment for the earlier season, 2014-15, mills had paid Rs 19,400 crore, he said.

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SUGAR SAGA

• Maharashtra government has asked sugar mills to first pay 80% FRP and the rest 20% later
   
• Farmers’ bodies have launched an agitation across the state to demand full payment without delay
   
• Farmers Action Committee convenor Satish Kakde says the government’s 80:20 formula had no legal sanctity
   
• Some mills especially from Western Maharashtra have started the FRP payment, paying Rs 1,800 to Rs 2,200 a tonne
   
• Mills from drought-hit Marathwada, north Maharashtra and Vidarbha are struggling to comply with the government directive