With the 2008-09 crushing season to start within a month, the farmers and the sugar industry are squabbling on the contentious sugarcane price in Uttar Pradesh.
While the farmers want the cane price to be Rs 160 per quintal, the industry wants the State Advised Price (SAP) to be Rs 112.
The core committee on Fixation of SAP for 2008-09, headed by state chief secretary Atul Kumar Gupta, held a meeting in Lucknow recently to discuss the issue.
It was attended by the principal secretaries of the state’s finance, justice and sugar industry departments, besides the state cane commissioner, experts and representatives of the sugar and khandsari units.
Now the core committee will recommend the cane price to the state government, which is likely to be announced by the end of this month.
Last year, UP had announced a SAP of Rs 125 per quintal for sugarcane (common variety).
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UP announces SAP every year to be paid by the sugar producers to cane farmers, while the centre also fixes the Statutory Minimum Price (SMP) every year. SAP is usually higher than SMP to offer more remunerative prices to the state farmers.
Yogesh Dahiya, chairman, cane society, Saharanpur, told Business Standard that the farmers submitted before the committee that the actual cost of growing sugarcane came to about Rs 200 per quintal, but keeping in mind the interests of the industry, they were ready to accept the price of Rs 160.
“The industry wants to fix the price on the basis of sugar prices, while the growers maintain that sugar is only one by-product of sugarcane, others being ethanol, chemicals and the co-generation by the mills,” he added.
Official sources said the farmers want the SAP to reflect the total product profile of the cane rather than just sugar.
There are an estimated 4 million cane farmers in UP and the total requirement of all the operational sugar mills is around 80 million tonnes (MT).
About Rs 182 crore in cane dues for 2007-08 is still pending with the state sugar mills, including the public sector units.
In 2007-08, the cane production in UP stood at over 160 MT with an acreage of about 2.5 million hectares. This crushing season, the production is down by almost 25 per cent and pegged around 120 MT.