Sugar News Details

After much dilly-dallying, Uttar Pradesh may retain cane price of last year


Coming under the glare of the Allahabad high court over the cane price issue, the Uttar Pradesh government has desisted from increasing the State Advised Price (SAP) for cane and decided to go with the last year’s rates. According to sources, a government notification on retaining the SAP for cane would soon come out.
Speaking to FE, a senior official of the cane department admitted that the matter had been sent for approval to every member of the state Cabinet by circulation but the file is yet to return. “As soon as it comes, a government order will be issued immediately,” he said on condition of anonymity.
Of late, the state government has been finding itself under the glare of the Allahabad high court which has been keeping a hawk’s eye on the cane price issue. The Bench, which was hearing the petition filed by UP Sugar Mills Association (UPSMA), said: “We would like to see the criteria/basis adopted by the state government for fixing the SAP for the last crushing season and also like to know as to what criteria/basis is proposed to be adopted this year for the fixation of such prices.”
The Bench, comprising judges DK Arora and Rajan Roy, was hearing the petition which challenged the tenability of SAP despite the existence of a centrally-announced Fair and Remunerative Price (FRP). UPSMA, through its lawyer JN Mathur, submitted that there was no logic behind the SAP and that it was fixed arbitrarily. He said it was fixed arbitrarily because last year, the FRP for cane was Rs 255 per quintal and SAP fixed by the state was Rs 315 per quintal, which is a difference of Rs 60 per quintal.
The Bench asked the state to furnish the details of cane-price fixation and whether the relevant information of the association and others have been duly considered while arriving at the SAP.  It also sought to know if the sugar floor price of Rs 29 per kg as declared by the Centre under the Essential Commodities Act had been factored in the final state cane price.
The Bench had posted the matter for hearing on December 10 and had, in the meantime, not restricted the Yogi Adityanath government from fixing SAP for the current crushing season 2018-19 as it is already late for announcing the price.  It’s more than a month since the season began and the millers as well as the farmers are still not clear about the cane price.
Last year, the government had announced the cane price in October itself.  But with general elections due in a few months, there has been a lot of push-and-pull pressure on the government despite the industry cautioning the state government. The industry had cautioned that with a glut in the market and low sugar prices, any hike in the cane price would result in a massive build-up of arrears the next season.
Despite the chief minister fixed Friday (November 30) as the last day for millers to settle all their dues, cane arrears for 2017-18 season still stand at Rs 5,000 crore. And, that too despite the fact that the state government has extended a soft-loan package of Rs 4,000 crore to millers to clear dues. It may be mentioned that the SAP for cane has been a bone of contention between the industry and the state government every year, with the farmers becoming pawns in the political slugfest.