UP sugar co-ops gear up for new season

Uttar Pradesh’s cooperative sugarcane societies are all set for the approaching 2008-09 crushing season.

These societies act as an interface between the farmers and sugar mills — the latter buy sugarcane for crushing through these bodies and pay 3 per cent commission on the Statutory Minimum Price announced by the Centre every year.

The estimated shrinkage in sugarcane acreage this year by over 25 per cent is also likely to impact the profitability of these societies with the bottom line of most of them in the red.

At present, there are a total of 168 cooperative cane societies in UP with only about 100 managing to make some profit. Most societies based in the western part of the state are in financially healthy and the eastern ones are in bad state.

The societies are presently engaged in the survey of the state’s sugarcane area.

The UP sugar industry has long been demanding the disbanding of these societies, so that they can buy crop directly from the farmers. However, the state government has not conceded to this demand so far.

“The societies are aimed at protecting the interests of the sugarcane farmers and this system will continue,” Cane and Sugar Commissioner Har Sharan Das told Business Standard.

At present, UP is the largest and second largest sugarcane and sugar producer in the country respectively, and the sector constitutes a major portion of the state’s Gross Domestic Product (GDP). The societies have between 10,000 to 40,000 farmers as members.