Image Credits: Those London Chicks
MUMBAI: It’s always been known as the land of politically powerful sugar barons, with many becoming chief ministers and cabinet ministers. Yet this year, Maharashtra has broken a record and touched the highest sugar production in its history at 105.58 lakh tonnes.
By the end of the season in May, sugar output in the state is set to hit 107-108 lakh tonnes. The previous record was in 2014-15 at 105.14 lakh tonnes. Maharashtra is the country’s second highest sugar producer, after Uttar Pradesh. “This is record production and crushing is not yet over. But the state is likely to finish second behind UP whose projections are higher,” said state sugar commissioner Sambhaji Kadu Patil.
But the glut is worrying for sugar factories and cane farmers. Sugar prices have crashed by Rs1,000 per quintal from Rs3,600 to Rs2,600. This is making it hard for factories to pay cane farmers the price set by the Centre at Rs2,550 per tonne. Pending dues to the state’s cane farmers are at Rs2,277 crore.
Nationally too, the picture is one of excess, with production 56% higher than last year. So far this year, sugar output has reached 304 lakh tonnes compared to 195 lakh tonnes last year, said Prakash Naiknavare, managing director of the National Federation of Cooperative Sugar Factories (NSCSF). Nationally, payments due to farmers are worth Rs20,000 crore, he said.
“With factories making losses due to low prices, it is difficult for them to get new working capital in the form of loans,” said NCP leader Dilip Walse Patil, NSCFC chairman. Many will not be able to function when the crushing season begins in October, he said. The cultivation area of water-guzzling sugarcane in India is expected to grow from 46 lakh hectares this year to 51 lakh hectares next year.
The industry is pushing for export of 4 mn tonnes of stock to stabilize prices, with NSCSF writing to PM Modi. So far, Centre has increased import duty from 50% to 100% and scrapped export duty (earlier it was 20%).