Ahead of the state government’s announcement of state advisory price (SAP) for sugarcane, the data of cane department show that sugar recovery has dipped by around 0.4% which has increased the cost of sugar production.
Sugar recovery, expressed in percentage, refers to sugar produced after processing of a definite weight of sugarcane.
Data accessed by TOI reveal that sugar recovery percentage has plummeted from 9.54% in 2019-20 to 9.15% at the start of crushing season this year. Private sugar mills alone registered a decline from 9.57% in 2019-20 to 9.16% in the current season. Even cooperative sugar mills registered a dip from 9.06% to 8.82% during the said period. Data shows that sugar recovery in private mills has been dipping since 2018-19 when it was 9.6%.
Industry sources said the decline in sugar recovery rate was due to damages incurred to the crop following untimely rains and occurrence of red rot disease mainly in east UP. Despite coronavirus crisis, sugar production in the current crushing season has registered an upswing in UP with the state recording production of 3.8 lakh tonnes of sugar by November 15 this year, which is around 30% more than in the corresponding period last year when 2.9 lakh tonnes of sugar was produced. Millers said this was because of increase in cane acreage and higher vegetative growth of cane after monsoon earlier this year. “In 2018-19, the state government gave financial assistance in view of the situation prevailing at that point of time. The 2019-20 season passed under due constraint but this year the situation has turned even worse,” a miller TOI on condition of anonymity. The cost of raw sugar at present is Rs 32 per kg amid the presence of carry forward stock resulting in sugar glut. “Under these conditions, neither the price of sugar is increasing nor the grant of Rs 2,800 crore from the Centre is coming through,” a miller said, pointing out that the state government is yet to pay Rs 1,000 crore for electricity produced by co-generation power plants installed in sugar mills. “The compounding impact on mills would adversely affect the timely payment of cane price,” he said. The development comes even as private sugar mills are defaulting on payment of around Rs 5,048 crore for 2019-20. The 22-odd cooperative mills in the state are also required to pay around Rs 546 crore to farmers. “Now, if sugar prices are increased, the situation would deteriorate further,” an industry expert said. The solution to this lies in increase in the cost of raw sugar, payment of funds from the Centre and compensation pending with UP Power Corporation Ltd (UPPCL).