The delay in crushing by sugar mills in Uttar Pradesh has put the sugarcane farmers in a tight spot — they are being pushed by gur producers to supply sugarcane at cheaper rates. The growers are desperate to vacate fields to start planting wheat.
In October, these gur producers were paying Rs 120-125 a quintal for sugarcane. This price has come down to Rs 95-100 a quintal. However, gur producers claim they have been a saviour to the farmers since mills are not crushing.
“Had the gur units not been operating, many growers would not have celebrated Diwali this time. Unlike the mills, we make immediate cash payments,” claimed a gur producer at Bhainsi village near Triveni’s Khatauli sugar mill in Muzzafarnagar.
He also pointed out that there would be pressure on gur units to pay a higher price once mills start. However, gur producers with their limited capacity have not been able to consume large quantities. Consequently, one can find sugarcane crops standing in most fields around the region. Usually, mills begin crushing by October-end.
Most of the growers around Meerut and Muzzafarnagar areas expressed disappointment with the staggered cane payment by mills in the last two seasons and plan to further bring down the acreage under the crop. “It would be remunerative for us to grow paddy and wheat and an intermediate crop between these two. This would also ensure timely payment and we would be able to meet our financial liabilities,” said Kishan Choudhary, a farmer in Meerut’s Walidpur village who supplies sugarcane to DCM Shriram Industies’ Daurala unit. Sugarcane acreage in the state is already down nearly 20 per cent this year as farmers shifted to crops like paddy and pulses.
Bankers in the region are hopeful that the sugar mills would do well this year unlike the last two seasons. The reason being a sharp appreciation in prices of sugar, the main product, as well as prices of molasses and bagasse, the two byproducts.
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The Uttar Pradesh Sugar Mills Association, in a meeting with Cane Development and Sugar Industry Minister Nasimuddin Siddiqui on Wednesday, indicated that the current recovery of 8.5-9 per cent would impact margins and assured to begin crushing once recovery improves.
Only three mills have begun crushing in the state so far — Brijnathpur, Simbhaoli and Modinagar. These mills have entered an informal agreement with cane growers to pay the price that would be legally decided.
On October 18, the state government had declared a price of Rs 140 a quintal for sugarcane. Sugar mills, however, say they are not in a financial position to run mills at this rate.
The industry has filed a writ petition at the Allahabad High Court against the price of Rs 140 a quintal declared by the state government. The next date of hearing is November 18. Industry sources have indicated that they would approach the Supreme Court if the High Court’s decision is not favourable. All these could mean further delays.