Plan panel against govt control on gur production

The Planning Commission, as well as farmers in Uttar Pradesh, leading sugarcane-growing state, have opposed a proposal by the food ministry to control gur (jaggery) production.

The food ministry has mooted the proposal to bring gur production under the Sugarcane (Control) Order, 1966, so that more quantities of sugarcane are available for producing sugar this year.

In July 2007, the Centre had removed gur from the Sugarcane Control Order, as the country had a surplus production of sugar, leading to a glut in the market.

Today, the situation is different. The country is expected to produce 16 million tonnes of sugar in 2009-10 season (October-September), against a demand of 23-24 million tonnes.

While the Plan panel appreciated the intention of the food ministry, it said there would be a long-term adverse impact of the move, sources said.

Also, a sugarcane growers’ body in Uttar Pradesh has opposed the move, saying it would debar farmers from getting a better price.

“Mills are lobbying to control gur in order to check prices of sugarcane as they know that ‘kolhus’ (gur-making units) would pay more to farmers for sugarcane this year due to its shortage,” Avdhesh Mishra of the Association of Presidents of Cane Committees in UP alleged.

In 2008-09 season, which ended in September, some gur-making units in UP have paid as high as Rs 250-260 a quintal for sugarcane compared to Rs 150-155 a quintal by sugar mills, as the cane production was lower in the state.

Mishra said control of gur units would kill competition and farmers would be left with no option but to supply cane to sugar factories at lower rates.

Arun Khandelwal, president, Federation of Gur Traders, Muzaffarnagar, said if the proposal was implemented, it would hit gur industry and create shortages in the long run which would not be met by imports, as gur was also used in making Ayurvedic medicine and cattle feed.

Before the lifting of gur from the order 2 years back, the Centre had the power to license gur units and set their production limit in the crushing season.

Announcing the decision after the Cabinet approval in 2007, Priya Ranjan Dasmunsi, the then information and broadcasting minister, had said the move would help sugarcane farmers to dispose of their cane at higher prices.

In 2007-08, India had produced 26.4 million tonnes of sugar, industry data show. The output fell to just 15 million tonnes the next season, mainly due to lower sugarcane production and diversion of cane for purposes other than sugar-making. The average utilisation of sugarcane for production of sugar was 73.38 per cent in the country, but was about 60 per cent in UP in 2007-08. Last year, the utilisation came down to just 53 per cent across the country and about 40 per cent in UP.