NEW DELHI:The Cabinet Committee on Economic Affairs on Wednesday has decided to increase the minimum price to be paid by mills to sugarcane farmers by Rs 20 per quintal for the next marketing year starting October.
The Commission for Agricultural Costs and Prices had recommended a Rs 20 per quintal hike in the Fair and Remunerative Price (FRP) of sugarcane at Rs 275 per quintal for the next season. At present, the FRP is linked to a basic recovery rate of 9.5 per cent, subject to a premium of Rs 2.68 per quintal for every 0.1 per cent point increase in recovery rate.
In the last Cabinet meeting, the government had announced a sharp increase in the minimum support price of kharif (summer-sown) crops including paddy.The move is expected to benefit farmers in major sugarcane-producing states like Uttar Pradesh, Punjab and Haryana. However, these states fix their own sugarcane prices called State Advisory Prices, which are more often higher than Centre’s FRP.
India’s sugar production is estimated to rise by 10 per cent to touch a new record of 35.5 million tonnes in the next marketing year starting October, as cane output could rise on normal rains, according to ISMA.
Sugar production in India, the world’s second largest producer after Brazil, is estimated to reach a record 32.25 million tonnes in the current 2017-18 marketing year (October-September).However, Sugar mill owners said the current hike will add to the woes of sugar mills and is currently unaffordable, till government increases ex-mill sugar prices.
Rs 275 per quintal is the Fair and Remu-nerative Price of sugarcane fixed for the 2018-19 season
9.5% basic recovery rate the FRP is currently linked to, subject to a premium of I2.68 per quintal for every 0.1% point increase in recovery rate