Maharashtra crosses 100 lakh tonnes in sugar production, but cane arrears, sales quota bigger worry for sector

The sugar business has opposed the 22 lakh tonnes of sugar sales quota given for the month of April. With restrictions coming into place resulting from surge in Covid-19 instances, this elevated quota could be troublesome to fulfill and outcome in extra lapsed quota for the mills, mentioned business sources.

Unlike the earlier 5 years, when 18 lakh tonnes quota was given for April, the central authorities has elevated the sales quota by 4 lakh tonnes this 12 months.

Jaiprakash Dandegoakar, president of the National Federation of Cooperative Sugar Mills, mentioned the pandemic has affected the sale of sugar because the consumption in inns and eating places has taken a success. Since March final 12 months, mills have been discovering it troublesome to fulfill their sales quota, which has led to liquidity disaster for them, he mentioned.

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Low sugar sales have led to pending cane arrears as mills are discovering it troublesome to pay their farmers for cane they’ve bought. With barely a month or so left in the 2020-21 crushing season, low sugar sales and mounting sugarcane dues are bigger issues for the business. As of March 31, cane growers in Maharashtra have reported unpaid dues price over Rs 2,266.46 crore, which goes to be a significant worry for the sector to clear.

After a comparatively lean season of 2019-20, mills in Maharashtra have seen report crushing for the present season. Since the beginning of the season, 188 mills had began their operations, of which 108 mills have ended their season. Initial estimates by the sugar commissioner’s workplace had estimated crushing of 874 lakh tonnes of cane and manufacturing of 95 lakh tonnes of sugar. However, as of April 4, Maharashtra has ended up crushing 972.3 lakh tonnes of cane and producing 101.73 lakh tonnes of sugar.

Nearly 20 lakh tones of cane nonetheless stays to be crushed with the season anticipated to recover from by the tip of this month. Mills in Pune, Satara, Jalna and Ahmednagar at the moment are primarily in operation.

While the business has seen report manufacturing, low sales of sugar has led to mounting cane dues in the state. By the tip of March, mills which had bought 908.49 lakh tonnes had been anticipated to pay growers Rs 20,122.32 crore as the federal government declared Fair and Remunerative Price (FRP). However, mills ended up paying Rs 17,869.75 crore, operating up arrears of Rs 2,266.46 crore. Of the 188 mills, solely 87 mills have cleared all their dues.

Mills, each cooperative and personal, have complained about their failure to fulfill their sugar quota, which has led to liquidity crunch for them. Between October to February, mills in Maharashtra had been anticipated to promote 32.03 lakh tonnes of sugar, but they’ve managed to promote solely 21.66 lakh tonnes. The remaining 10.37 lakh tonnes stay unsold, including to the mills’ stock and resulting in the present disaster in the sector.

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