Maharashtra govt decision to delay cane crushing will push up sugar price: Millers

The 2015-16 crushing season had seen 84.08 lakh tonnes of sugar being produced, and 99 cooperative and 78 private mills operational.

Written by Partha Sarathi Biswas | Pune | Published:October 5, 2016 4:49 am
maharashtra, maharashtra Sugar Mills, Sugar Mills cane crushing, cane crushing delay, Sugar price, Bombay High Court, Sugar Mills stock, mumbai news, india news As of date, the sugar stock in the state is 33 lakh tonnes and, millers said, the two-month delay in the new season might see an escalation of prices. Maharashtra’s share of sugar nationally is 34 per cent. (Representational/File image )

THE Maharashtra government’s decision to start the sugarcane crushing season 2016-17 on December 1 has raised many eyebrows in the sugar lobby, who say it would push up sugar prices across the country and make less cane available to millers. Normally, the crushing season starts by October-end. Late Monday evening, the ministerial committee met to discuss the upcoming crushing season. As of date, the sugar stock in the state is 33 lakh tonnes and, millers said, the two-month delay in the new season might see an escalation of prices. Maharashtra’s share of sugar nationally is 34 per cent.

Yogesh Pande, sugar analyst, said post-November prices of sugar will see an upswing. “Mostly, the first batch of sugar produce hits the market in the second week of November. However, this delay of a month will create a crunch and prices will rise from November and remain high till February,” he said. Millers said not only will this be the most delayed start to the season, but will also be detrimental to them in terms of cane availability. Jaiprakash Dandegaonkar, vice-president of the Maharashtra State Cooperative Sugar Factories Federation, said, “This would be the most delayed start to the season in recent times and was done taking into consideration the condition of the cane crop,” he said.

Dandegaonkar said the delayed start will allow more growth and, subsequently, more recovery of sugar for the mills. During the meeting, sugar commissionerate officials said this year 6.57 lakh hectares has come under cane cultivation. Last year, the figure was 10.5 lakh hecatres. Also, it is estimated that 150 mills – 80 cooperative and 70 private mills – will be operational this season and sugar output is estimated to be 50 lakh tonnes.

The 2015-16 crushing season had seen 84.08 lakh tonnes of sugar being produced, and 99 cooperative and 78 private mills operational. It may be noted that 157 of the mills operational last year have paid almost 100 per cent of Fair and Remunerative Price (FRP) to cane growers. At present, Rs 157 crore remains to be paid to the growers. Only 55 per cent of the mills in Marathwada, Ahmednagar and Solapur would be operational this year due to paucity of cane. While the delayed start would help these mills in better sugar recovery, the mills in the sugar belt of Kolhapur and Sangli would have to face the music. Millers from Kolhapur pointed out how neighbouring Karnataka would start its crushing season on November 15.

“Traditionally, the mills in Kolhapur start operations during the first week of November. These areas have good cane crop so once the mills in Karnataka start, growers would prefer taking their produce there and we will be in short supply,” said a miller from Kolhapur. Another fear, millers said, was that the simultaneous start of mills in cane-rich and cane-deficit areas would also result in diversion of cane from the former to the later.

Incidentally, Cooperation Minister Subhash Deshmukh has mills in the Solapur area, which have reported drastic dip in cane area. Millers from Sangli and Kolhapur said they would wait for the minutes of the meetings to be finalised and then take a call. Sanjiv Babar, managing director of the federation, said during the ministerial committee meeting, this matter was raised and it was decided that the cooperation minister would talk to the Karnataka chief minister on the issue.