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News
No hike in SAP, cane growers bitter
Date:
12 Nov 2017
Source:
Tribune
Reporter:
Ruchika M Khanna
News ID:
23767
Pdf:
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The spiralling price of sugar has failed to reap any benefit for cane growers as the Punjab Government has decided against increasing the state-assured price (SAP) of sugarcane. For the fourth year in a row, cane growers will get Rs 285 to Rs 300 per quintal. The cane crushing season begins on November 15. Only one mid-yielding variety — 0238 — will fetch the price of early maturing cane and that is Rs 300 per quintal. The price of the mid-yielding variety is Rs 295. The retail price of sugar is at an all-time high of Rs 4,000 to Rs 4,100 per quintal. Sugar mills are getting between Rs 3,900 and Rs 3,950 per quintal, though the standard cost of production is around Rs 3,200 per quintal. This means the mills, mostly the private ones owned by leading politicians across party lines, will be raking in the moolah this year. Private sugar mills, seven in all, are most likely to buy 70 per cent of the cane production. The cooperative sugar mills, with obsolete machinery and no backward and forward integration (cogeneration plants and distilleries), have higher cost of production. Thus, they will not be able to make profit. In fact, Sugarfed officials estimate Rs 150-crore loss to cooperative mills (nine in all) this season. Sources in the Agriculture Department told The Tribune they had recommended an increase of Rs 10 per quintal for the early, mid and late maturing varieties, raising the price to Rs 295, Rs 300 and Rs 310. The farmer associations demanded an increase of Rs 25 across varieties. “The reason for not increasing the SAP is that the state cooperative mills are already reeling under huge losses. The cash-starved state government cannot bail them out. They are still to pay Rs 71 crore pending since the last crushing season,” said a senior official.
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