UP sugarcane payments hit Rs 10,000 crore mark

Uttar Pradesh sugar mills have paid over Rs 10,000 crore to farmers against sugarcane procurement under the current 2016-17 crushing season, which is still underway.

The payments have been made against payables of about Rs 13,100 crore for 2016-17, which pegs payment ratio higher than 75 percent.

Besides, UP sugar mills have collectively settled Rs 17,635 crore against dues of a little over Rs 18,000 crore for the previous 2015-16 crushing season. The balance of about Rs 368 crore is pending on 13 private sugar mills.

Meanwhile, the UP mills have collectively clocked production of over 5 million tonnes (MT) of sugar in the current season. The mills are projected to produce almost 3.5 MT of additional sugar before the crushing season concludes, which would peg sugar output at roughly 8.5 MT for full season.

Sugarcane is a major cash crop in UP and there are over 4 million rural households engaged in cane farming. UP and Maharashtra are India’s top sugarcane and sugar producers and contribute 50 percent to India’s annual production.

This season, UP is likely to contribute almost 40 percent to the country’s sugar output.

The private mills dominate UP sugar sector with 92 of total 117 mills. The cooperative sector comprises 24 mills, while UP State Sugarcane Corporation Limited (UPPSCL) controls one mill.

With UP government fixing cane price at Rs 305/quintal, the value of cane procurement by mills is likely to exceed Rs 22,500 crore in the current season. This way, the total payment would be 25 percent more than the total value of cane payables registered by all the 117 UP sugar mills in the previous 2015-16, which had then stood at Rs 18,000 crore.