The Centre on Wednesday decided to increase the sugarcane Fair and Remunerative Price (FRP) by Rs 10 to Rs 285 per quintal for the marketing year starting October 2020.
The Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi approved the FRP payable by sugar mills for the 2020-21 sugar season (October-September) on the recommendations of the Commission for Agricultural Costs and Prices (CACP), read an official statement.
It includes FRP at Rs 285 per quintal for a basic recovery rate of 10 per cent, a premium of Rs 2.85 per quintal for every 0.1 per cent increase above 10 per cent in the recovery, and a reduction in the FRP by Rs 2.85 per quintal for every 0.1 per cent decrease in recovery, in respect of those mills whose recovery is below 10 per cent but above 9.5 per cent.
For mills with recovery 9.5 per cent or below, the FRP is fixed at Rs 270.75 per quintal.
The determination of FRP will be in the interest of sugarcane growers keeping in view their entitlement to a fair and remunerative price for their produce, said the officials.
The FRP is determined under the Sugarcane (Control) Order, 1966. It is uniformly applicable all over the country and is the minimum price that sugar mills have to pay to sugarcane farmers.
Agriculture expert Sudhir Panwar called the Rs 10 hike in sugarcane FRP "insufficient and much below the expectations of farmers and the governments' promise of doubling of farmers income"
"The hike of Rs 10 a quintal (3.6 per cent) by the Narendra Modi Government is insufficient in offsetting the increased input cost on account of diesel (17 per cent) and electricity tariff (100 per cent in UP) and the 2-15 per cent increase in brands of pesticides and insecticides. It is much below the expectations of farmers and government promise of doubling of farmers’ income," said Panwar.
Sugarcane producing states such as Uttar Pradesh, Punjab and Haryana fix their own sugarcane price called state advisory prices (SAPs), which are usually higher than the FRP.
The government estimates the country’s total sugar production to be 28-29 million tonnes in the current year ending next month, compared to 33.1 million tonnes during 2018-19 due to a sharp fall in acreage in Maharashtra and Karnataka.