Within two weeks of commencing crushing operations, private sugar mills in the country’s second-largest producer, Uttar Pradesh, have managed to pay off R350 crore of their last year’s dues, which were pegged at a staggering R2,400 crore till the beginning of the season. “We have managed to clear off dues to the tune of R350 crore within a span of two weeks after the season started and we are hopeful of clearing the remaining R2,060 crore by January 15,” said an official of the UP Sugar Millers Association.
as many as 117 sugar mills of the 124 in the state have started crushing operations this season. While three more are expected to start later this month, four will not crush this year at all.
Of the 117 mills that have started crusing, 94 are private while 22 are run by the Uttar Pradesh State Sugar Cooperative Federation and one by the UP Sugar Corporation. Together, these mills have crushed 555.50 lakh qunitals of cane to produce 47.76 lakh quintals of sugar. As far as cane price payment to farmers for the current season is concerned, dues payable after 14 days of procuring cane work out to be R136.87 crore, of which sugar mills have paid R54.89 crore, approximately 40% of the total dues.
Interestingly, compared to last year's corresponding figures till Thursday, cane crushed stood at 1,456.95 lakh quintals while sugar production stood at 125.86 lakh quintals. This is
almost three times more than this year.
The main reason for low production is that sugar mills started crushing very late this year due to the stand-off with the Uttar Pradesh government regarding the cane price issue.
“But there is no reason to worry as late crushing is not likely to hamper the final sugar production figure in a big way. Sugar recovery improves only when the cane matures properly as is the case this year. Though we started late, it will not make a big difference on the final sugar production figures,” said a sugar miller on the condition of anonymity.
However, according to industry experts, the flip side of this delay is the probabity of cane getting diverted to the unorganised sector. “The unorganised sector, comprising kolhus, crushers and khandsari units, usually takes advantage of the delay in start of crushing. And for all those farmers who are unable to wait for the mills to start operating and are in desperate need of money, the only option is to go to these units and sell their crop at a much lower price,” he said.
Usually, an average of 50% of the total sugarcane produced by the state is drawn by sugar mills while 30% goes towards making gur, 5% towards khandsari units and the rest 15% towards seeds and as fodder.
“By starting late, the millers have allowed the unorganised sector to make inroads into cane availabilty. As it is, none of the mills have enough cane to last the entire season and most of the time they are running the mills on around 70% capacity only due to shortage of cane,” added another industry source.