Centre raises sugarcane price by Rs 20 a quintal

The government on Wednesday raised the minimum price sugar mills pay to the cane growers by Rs 20 per quintal to Rs 275 per quintal for the 2018-19 season starting from October 1.

The fair and remunerative price (FRP) of sugarcane is Rs 255 per quintal for the 2017-18 marketing year (October-September).

The FPR will be Rs 261.25 per quintal for the next season if the recovery is below 9.5 per cent.

A decision in this regard was taken in the meeting of the Cabinet Committee on Economic Affairs (CCEA) headed by Prime Minister Narendra Modi.

Law Minister Ravi Shankar Prasad, who briefed the media on the Cabinet decisions, said this rate is 77.42 per cent over and above the sugarcane production cost of Rs 155 per quintal for the season and thus it meets the government’s promise of a return of more than 50 per cent to the farmers over their cost.

The new price below which the sugar mills cannot buy the sugarcane is for a basic recovery rate of 10 per cent, with a premium of Rs 2.75 per quintal on each 0.1 per cent increase in the recovery.

Taking into account the likely sugarcane output in 2018-19, total remittance to the sugarcane farmers will be more than Rs 83,000 crore, he added.

The increase is also likely to result in states like Uttar Pradesh, which do not follow the centrally-announced FRP, raising their own advisory prices.