Court asks UP sugar mills to pay Rs 110 a qntl for cane

Granting partial relief to sugar mills reeling under high cane prices and falling realisations, the Lucknow bench of the Allahabad High Court today allowed mills in Uttar Pradesh to pay Rs 110 per 100 kg for cane, Rs 15 lower than the price set by the state government, an industry official said.

The state government had asked mills to pay Rs 125 per 100 kg for buying cane from farmers this year. Private sugar mills in the state had filed writ petitions in the high court challenging the state government's cane price, which is much higher than the statutory minimum price for cane announced by the central government.

The central government had set the Statutory Minimum Price for cane at Rs 81.18 per 100 kg for this year.

The petitioners claimed they would face heavy losses if they pay the state advised cane prices to farmers due to falling realisations from sugar. They also pleaded to be allowed to follow the minimum cane price fixed by the central government.

While the Bench allowed mills to pay lower cane price to farmers, it also directed them to start cane crushing operations. The next date of hearing in the case is December 16, the official said.