'Price mismatch worries sugar industry'

Mismatch in the prices of cane and white sugar is causing severe loss to the factories resulting in huge arrears to farmers by the mill owners, says a top official of a sugar company.
"We are not being able to pay the cane price to the farmers as the white sugar prices are not remunerative causing severe losses in our operations", CMD of Riga Sugar and past president of Indian Sugar Mills Association (ISMA) O P Dhanuka said.
He said that while the per quintal cane price was around Rs 2,200, the ex-factory price of white sugar of equivalent amount was Rs 2,600.

This was causing losses as the recovery was only nine per cent (nine kilograms of white sugar could be obtained by crushing 100 kilograms of cane), he told reporters here today.
The accumulated cane arrears due to five crore farmers till this fiscal from 2011-12 would be to the tune of Rs 17,000 crore.
Dhanuka said, the country had surplus sugar capacity but the government was allowing raw sugar imports for re-exports which was compounding the problems.
He said that duty on raw sugar imports at present was 25 per cent, which according to him, was low.
Dhanuka said while the Centre was determing the fair remunerative price (FRP) for cane, it should be linked to the sugar price realisation.