Uttar Pradesh : Take note of drop in sugar recovery, assn writes to govt amid SAP increase buzz
The Uttar Pradesh Sugar Mills Association (UPSMA) has raised concerns over a possible sugarcane SAP hike, citing rising production costs due to reduced sugar recovery rates. Despite increased SAP, sugar and ethanol prices remain stagnant, causing financial strain. UPSMA urged the government to address low transportation rebates, molasses pricing, and revise ethanol prices to sustain the industry.
Lucknow: Apprehending a possible increase in State Advisory Price (SAP) of sugarcane for 2024-25, the UP Sugar Mills Association (UPSMA) expressed its concern over a further drop in sugar recovery, pushing the cost of production further up.
In a communique sent to UP chief secretary Manoj Kumar Singh, the association said that the recovery showed a steep downward turn ranging from 0.3% to 1%. This drop pushed the cost of production of sugar by Rs 140 per quintal.
The UPSMA also stressed that the prices of sugar did not increase in the ongoing fiscal year despite the increase in cane SAP in Jan last year. The minimum selling price (MSP) of sugar was last revised in 2019 and has since remained stagnant, the association pointed out.
The UP govt, in Jan last year, raised the SAP of all sugarcane varieties by Rs 20 per quintal for all three varieties of sugarcane. SAP for early maturing varieties increased from Rs 350 per quintal to Rs 370. For common varieties, it increased from Rs 340 to Rs 360, while for late maturing varieties, it was raised from Rs 335 to Rs 355 per quintal.
UPSMA’s fresh concern stems from indications from the cane development department that the govt may consider further revision in SAP in the wake of protests by farmer groups. The issue, sources said, has already started gaining ground in the politically significant west UP region, which has a sizable presence of sugar mills.
Sources said that a decision on SAP is expected to be taken by the state cabinet headed by CM Yogi Adityanath in the next few days. A senior official said that a high-level committee headed by the chief secretary and the cane development department would take up the issue before the cabinet. Sources said that the issue of raising the SAP has been building up since the 2024 Lok Sabha elections in which the BJP faced a setback.
The association further said that the transportation rebate has been low despite the much higher increase in freight cost. The UPSMA also underscored the “extremely low administered” price of Rs 152 per quintal for molasses, essentially used for the manufacture of country liquor. The price of molasses in the free market is pegged at Rs 1000 per quintal, a senior UPSMA official said.
“Even the realisation from ethanol (even though it is a separate business) has not seen any commensurate price rise compared to the cane price increase over the past two years,” the association wrote, urging the govt to revise the prices of ethanol on a “priority basis.”
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Source : The Times Of India
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