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A bigger cane crop does not seem to be doing any good to the sugarcane farmers of Uttar Pradesh this year.
Sugar mills, while complaining of high State-advised price (SAP), are apparently buying a lot of cane out of the system ‘for cash’. This would mean a realisation lower than the SAP for the farmer.
Seeking liquidity, the farmers, who are also under pressure to clear cane-fields to plant wheat (a key winter crop), are selling cane to the intermediaries for cash, which in turn is being bought by sugar millers, people in the know said.
“Cash purchases are being made by mills through middlemen at Rs 210-230 a quintal, much lower than the SAP of Rs 280. The State is doing nothing about it at all,” said V. M. Singh, Convenor, Rashtriya Kisan Mazdoor Sanghatan.
Alleging a nexus between the millers and the State government, Singh said farmers are being put to a lot of hardship as the middlemen are fleecing them.
The delay in announcement of SAP by the UP Government has led to a delayed start to the crushing season this year. UP announced a 17 per cent hike in SAP, at Rs 280 a quintal, on December 7.
Poor implementation
Despite a better cane crop compared to States such as Maharashtra in the 2012-13 season, sugar production in UP was down 11 per cent till end-December, at 1.92 million tonnes, over the corresponding period last year.
“The SAP announcement is just on paper and not being implemented properly,” Singh said, adding that farmers have been protesting in various parts of the State.
The UP sugar output in the current year is projected to be 13.7 per cent higher, at 7.9 million tonnes, according to the Indian Sugar Mills Association.
This is mainly on account of higher acreage and better yields, aided by good rains.
When asked about the cash purchases by mills, S. L. Gupta, Secretary of the UP Sugar Mills Association, said he “did not have any idea of such a trend”.
“I don’t think it is possible,” Gupta added.
However, Sudhir Panwar, President of Kissan Jagriti Manch, alleged that the mills were not interested in purchasing the cane at SAP rates. Only a few co-operative and private mills are doing it.
Panwar said mills were buying unauthorised cane through middlemen, mainly in Western Uttar Pradesh and adjoining Haryana. Western UP has seen cane inflow from neighbouring Haryana, where the prices are relatively lower. Estimates of such unauthorised cane purchases were not available.
Further, Panwar alleged that mills were colluding with the functionaries of the cane societies and are delaying cane purchases. Such a trend is exerting pressure on farmers, who want to plant a second crop, particularly wheat.
Panwar said the concept of middlemen in sugarcane, which was mainly prevalent in the central and eastern UP has now spread to the western side as well.
Time value of cane
However, the cash purchases by mills seem to have come in handy for farmers — who seemed to have made a trade-off in favour of getting cash in one go rather than wait for a delayed payment. According to Panwar, sugar mills have made about 30 per cent of the payment in the current year.
Vishwanath.kulkarni@thehindu.co.in
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