UP mills to settle sugarcane arrears in flood affected districts

Arrears Rs 3,700 crore pertain to 2012-13 crushing season which concluded in May

Uttar Pradesh private sugar millers are likely to clear by month end, 90% of their consolidated sugarcane arrears currently standing at about Rs 3,700 crore.

The arrears pertain to the 2012-13 crushing season, which concluded in May.

Yesterday, the Lucknow Bench of Allahabad High Court had asked the state government to ensure settlement of the cane farmers’ dues within 6 weeks.

The payment to farmers in the flood affected districts in UP has to be settled in 2 weeks on priority.

“By July end, we are confident of settling almost 90 of the arrears,” a UP Sugar Mills Association official told Business Standard.

Meanwhile, the Association has urged the state government to expedite payment of co-generation dues to the respective mills, so that the arrears could be settled faster.

State utility UP Power Corporation Limited (UPPCL) owes about Rs 1,000 core to the private mills in dues relating to co-generated power, which is supplied over the grid.

The state millers supply bagasse-based power generated to UPPCL under power purchase agreement (PPA).

During the crushing season, the state mills have the capacity to produce about 900 Mw of power.

Sugar is the largest organised agro-based industry in UP supporting over 4 million farmers’ families. Other industries viz. molasses, bagasse, power (cogeneration) etc are supported by sugarcane, whose annual economy is estimated over Rs 30,000 crore.

During 2012-13, UP sugar output was 7.47 million tonnes (MT), which was 7% higher compared to last year’s sugar output at 6.97 MT.

The state mills crushed 81.25 MT of sugarcane purchased from cane societies, which are the interface between mills and growers.