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Payment of Dues to Sugarcane-Growing Farmers

New Delhi: The State-wise details of cane price dues of sugarcane famers during current sugar season 2018-19 and last sugar season 2017-18, as on 16.07.2019, is at Annexure.

Depressed sugar prices due to surplus sugar production, during the previous sugar season 2017-18 adversely affected the liquidity of the sugar mills resulting in accumulation of cane price arrears of the farmers.

With a view to improving the liquidity position of sugar mills in the country, including state of Punjab, and enabling them to clear cane price dues of farmers, the Government has took following measures in sugar seasons 2017-18 & 2018-19:

  1. Fixing a Minimum Selling Price (MSP) of sugar w.e.f 07.06.2018 at Rs.29/kg for sale at factory gate in domestic market, below which no sugar mill can sell sugar. MSP has further been increased to Rs.31/Kg. w.e.f. 14th February, 2019.
  2. Extending Assistance to sugar mills to offset the cost of cane in sugar seasons 2017-18 and 2018-19.
  3. Extending assistance to sugar mills by reimbursing carrying cost towards maintenance of buffer stock of 30 LMT of sugar.
  4. Extending Assistance to sugar mills for defraying expenditure towards internal transport, freight, handling and other charges to facilitate export of sugar from the country in sugar season 2018-19.
  5. Extending soft loans to sugar mills through banks for which Government would bear interest subvention @ 7% for one year to clear cane price arrears.

Under the schemes enumerated in para (ii) to (v) above, it has been provided that funds will be directly credited to farmer’s accounts on behalf of the sugar mills against their cane price dues.

It has been informed by state government of Punjab that they have also provided Rs.215 crores assistance to co-operative sugar mills to clear the cane arrears of farmers for sugar season 2017-18. For the sugar season 2018-19, the State Government has provided Rs. 25/- per qtl. (Rs.52.75 crores) out of the State Agreed Price (SAP) on behalf of private sugar mills till 07-07-2019 to clear cane price arrears.

Payment of cane price to sugarcane growing farmers by the sugar mills is a continuous process. However, as a result of various measures taken by the Government as enumerated in reply to Para (b) & (c) of the question, the cane dues of farmers for previous sugar season 2017-18 have been reduced to only Rs. 285 crores as on 16.07.2019.

This information was given in a written reply by the Minister of State for Consumer Affairs, Food & Public Distribution, Danve Raosaheb Dadarao in the Rajya Sabha today.

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