There is a good news for about 110 cooperative sugar mills in Maharashtra, as the State Cooperative Bank (SCB), an anchor for agriculture and crop loans, has okayed pre-seasonal loans. This loan is necessary for overhauling, payment of advances to harvesting and transportation contractors, purchase of stores materials and payment of off-seasonal wages to labours.
About Rs 1,150 crore is expected to be disbursed, comprising Rs 650 crore by Maharashtra SCB and Rs 500 crore by District Central Cooperative Banks (DCCBs) to 110 mills. The crushing season for 2011-12 would start from October 1. Maharashtra SCB and DCCBs had disbursed Rs 1,150 crore before the commencement of the 2010-11 crushing season.
Vijaysinh Mohite-Patil, chairman of the Federation of Cooperative Sugar Factories in Maharashtra, a representative body of over 160 mills, told Business Standard, “According to the Maharashtra SCB’s circular, a pre-seasonal loan of Rs 200 per sugar bag (100 kg) will be provided. If the factory has a crushing capacity of 1,250 tonnes per day to produce 200,000 quintal of sugar, it will be entitled to get Rs 4 crore of pre-seasonal loan. This will increase in proportion to higher crushing capacity and production.”
He informed that those factories not in default in the payment of pre-seasonal loan taken before the commencement of the 2010-11 season would have no problem in getting it. However, factories having negative networth would need the state government’s default guarantee for the pre-seasonal loan.
Mohite-Patil informed that Maharashtra is expected to have a sugar production of 9.2 million tonnes in 2011-12 against 9.05 million tonnes in 2010-11. “About 84 million tonnes of sugarcane will be available compared to 80.2 million tonnes in 2010-11, a five per cent rise. The availability of pre-seasonal loan will help mills to operate in full capacities,” he said.