Sugarcane arrears relatively lower at Rs 78.26 bn in ongoing season

Cane arrears are lower than the last season because of various measures taken by the central government and efforts of state governments

Last Updated : Jan 25 2018 | 11:10 PM IST

Sugarcane arrears are “relatively lower” and sugar mills owe Rs 78.26 billion to farmers so far in the ongoing season, the government said on Thursday.

According to the government data, sugar output is estimated to be higher at around 25 million tonne (mt) in the ongoing 2017 -18 season (October-September), against 20.2 mt in the previous year.

While sugarcane price is fixed by the Centre, some states like Uttar Pradesh set their own state advised price (SAP), which is normally higher than the central rate.

According to the rule, mills have to pay cane price within 14 days of supply of raw material, failing which interest at 15 per cent per annum is charged on amount due for the delayed period.

In an official statement, the food ministry said: “Despite higher production and lower sugar prices in the current season as compared to previous sugar season, the cane price arrears are relatively lower.”

Cane arrears are lower than the last season because of various measures taken by the central government and efforts of state governments, it said. As on date, cane price arrear in the current season on SAP basis is at Rs 78.26 billion in comparison to Rs 89.82 billion during the corresponding period of last season, it added.

The ministry also said: “Crushing of sugarcane during current season is in full swing and mills will be able to liquidate their cane dues by the sale of sugar and their by- products in the coming days”.

Even the cane price arrears for the 2016-17 season have been reduced to only Rs 520 million (on the basis of central price FRP) and Rs 10.76 billion (SAP basis) against cane dues of Rs 576.08 billion.

Thus, about 99.9 per cent of cane dues (FRP basis) in respect of 2016-17 season have been cleared.

In case of arrears of the 2015-16 sugar season, only Rs 1.22 billion (FRP basis) and Rs 7.10 billion (SAP basis) are pending and payments for earlier arrears are in process, the ministry added. India is the world’s second largest sugar producer.