Jalandhar: The Punjab government may face fresh trouble at hands of private sugar mills, which process around 70% cane in the state. Millers have said they would only pay fair and remunerative price (FRP) fixed by the Union government to farmers, instead of the Punjab government’s state-advised price (SAP). Millers said the state government, if it wanted to go ahead with SAP, could pay the remaining amount over the FRP. FRP has been fixed at Rs 275 per quintal this year, while Punjab government had announced an SAP of Rs 310 per quintal last year. The state government is yet to announce the SAP for this crushing season.

In an advertisement in a section of vernacular newspapers on Tuesday, Punjab Private Sugar Mills Association said millers had not even surveyed or bonded cane, a practice which starts in May, this year. Private millers and sugarcane growers saying the state government has not resolved the issue even as they have approached it several times in the past few months.

“The average sugar prices are Rs 3,000 per quintal. With Rs 310 per quintal rate of cane, we would incur a cost of Rs 3,775 on production of one quintal of sugar. That is not even the rate of sugar in the market; it is bound to cause huge losses to each miller,” said association president Jarnail Singh Wahid, who co-owns a sugar mill in Phagwara.

“We have been meeting senior government officials and telling them that we would not be able to pay more than the FRP, but we have not got a final word from the government. As state government did not address our issue, we decided to announce to the farmers that we would be able to pay only the FRP. In fact, we had made a similar announcement in March also,” Wahid said.

Rana Inder Partap Singh of Rana Sugars Limited said they were not legally bound to crush the cane at the SAP as they had not entered into bonds with growers. “We wrote five letters to the government, flagging these issues but we have not been informed about any solution,” he said.

Rana added that only three states — Uttar Pradesh, Haryana and Punjab — were announcing SAP. “The other two states have either been paying subsidy or soft loans to mills, but in Punjab the entire burden has been passed on to the millers and even last year we suffered losses,” Rana said. “We are yet to pay around Rs 250 crore of the previous year also,” he said, adding that the Punjab government, in 2015-16, paid Rs 50 per quintal to the farmers in a similar situation.

Bharti Kisan Union Doaba general secretary spokesperson Satnam Singh Sahni said area under cane had increased by around 12% to 1.05 lakh hectares in Punjab. “The state government has not resolved the issue even as we have been raising it. FRP alone is not enough to make a profit for farmers. The state government must intervene. Otherwise, we are already staring at losses. Like this, farmers will give up cane cultivation from next year,” he said. Punjab cane commissioner Jaswant Singh was not available for comment.