Maharashtra govt may pay for speedier cane crushing

The Maharashtra government is considering incentives to speed the cutting and transport of sugarcane to sugar factories.

The estimated crop is about 81 million tonnes and mills have crushed 77.9 mt so far, to produce 8.8 mt of sugar, at a 11.3 per cent recovery. It all of it would be crushed, at that rate, there would be 9.5 mt of sugar.

However, there is apprehension that an early monsoon may ensure about four mt of cane remains uncrushed, in the fields. The government has already instructed about 60 mills in the cane-rich regions of Pune, Solapur, Ahmadnagar and Satara not to close operations till all the cane was crushed.

A state government official, who did not want to be identifed, told Business Standard: "The state government is aware of the situation and is considering offering additional incentives for timely cutting and transportation of cane. The industry has sought Rs 500 per tonne as the government grant (for doing so). So the government may have to prepare a package of Rs 200 crore (given the four mt still to be crushed)."

Besides, if the cane remains uncrushed, the industry has demanded a per-hectare compensation of Rs 50,000. That means another Rs 250 crore.

Sources said the state government during 2006-07 had given Rs 25,000 per ha to farmers as compensation for uncrushed cane and distributed Rs 184 crore to the industry. "If the government plans to provide incentives to enable crushing of the entire standing cane, it would be a timely move," they said.

Official at the Federation of Cooperative Sugar Factories in Maharashtra, representing 165 mills, said the state government had already announced a subsidy for long-distance transport at Rs 3 per tonne per km and Rs 65 per tonne for cane crushed in the first fortnight of May, repeated in the subsequent fortnight.