Sweet victory

UPs cane farmers get to quote their price in a sellers market

By Savvy Soumya Misra
Published: Thursday 31 December 2009

A farmers’ rally in Delhi in November demands profit sharingOn December 1, Uttar Pradesh’s sugarcane growers reached Lucknow in thousands to protest the Rs 180-Rs 185 (including bonus) state administered price (SAP) announced for the 2009-10 cane crushing season; they demanded Rs 220 per quintal for their sugarcane. The farmers threatened they would sell their cane to mills in neighbouring Uttarakhand and Haryana if they did not get a good price. Meetings were held with state government representatives who put the ball in the state sugar mill owners’ court. Two days later mill owners in the state agreed to pay Rs 205-210 per quintal. The farmers are satisfied with the price revision, applicable to all sugar mills in state. They are confident sugarcane this year will fetch far more than the SAP. A price war is likely owing to the shortage of cane in Uttar Pradesh, said Dharmendra Malik of Bhartiya Kisan Union (BKU), the organization working to protect the interest of farmers. “By the end of the season the farmers could get up to Rs 250 per quintal as mills will try to procure as much sugarcane as they can,” Malik added. Drought conditions and poor rates last year led to the shortage in sugarcane; Uttar Pradesh farmers were able to get between Rs 145-Rs 160 per quintal from the mills against Rs 120-Rs 125 per quintal of the SAP in 2008-09, Malik said. Had the farmers not protested, by season end prices would have gone up to only Rs 220. The state government had declared this year’s SAP between Rs 165-Rs 170 per quintal with a bonus of Rs 15 per quintal. “Sugar in the market has touched almost Rs 40 per kg; clearly, it was a raw deal for cane growers,” Malik said.

Sugarcane farmers are
confident shortage will
fetch them far more than
the state minimum price

The mill owners had offered an incentive of an additional Rs 10 to farmers bringing the price of cane up to Rs 195 per quintal. Some farmers have begun to take their produce to sugar mills in Uttarakhand where they are getting Rs 230 per quintal. Though SAP in Uttarakhand and Haryana range between Rs 180-Rs 185 per quintal, farmers have been promised incentives. But not all can afford transportation to neighbouring states. Sugarcane farmers can sell their produce only to designated mills within the state. “It is wrong on the part of sugar mill owners of one state to lure farmers of another. It is illegal and the state government in such a case will take action and forcefully stop the movement of sugarcane across the border. The farmers will have to sell their cane to the mills in Uttar Pradesh,” said S L Gupta, secretary, Indian Sugar Mills Association. The Uttar Pradesh farmers’ struggle for a better price for sugarcane was being carried out in the backdrop of another struggle with implications for sugarcane growers all over the country. A massive farmers’ rally in Delhi on November 17 protested an ordinance that introduced amendments made in Sugarcane Control Order 1966, deleting clause 5(A) of the order which provides for sugar mills to share additional profits with the sugarcane farmers. Clause 5(A) ensures 50-50 profit sharing between farmers and mill owners. The 2009 sugarcane ordinance introduced a change in the sugarcane pricing policy and the statutory minimum price (minimum support price fixed by the Centre) was replaced with fair and remunerative prices (FRP) and made applicable to all states. Changing a clause in the essential commodities act, the sugarcane ordinance stated in case any state set the SAP higher than FRP, the onus would be on the state government to meet the difference and not the mill owners. This was reversed following protests and the difference will now be paid by mill owners. “The farmers do not receive their share of profits that the mill owners make. But at least clause 5A gives a legal backing for farmers. There were requests from farmer organisations and leaders of the southern sugarcane growing states that the clause be reinstated,” said T Haque, former chairperson of the Commission of Agricultural Costs and Prices and patron of National Alliance of Farmers Association. The ordinance has been withdrawn and an amended sugarcane bill is likey to be tabled in the winter session of Parliament.

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