Issues |
Present Position |
Demand by Commodity Council |
a) Fixing of Statutory Minimum Price (SMP) to Sugarcane
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1) The provisions of Sugarcane Control Order 1966 regarding fixing Statutory Minimum Price (SMP) taking into consideration Cost of Cultivation, Consumer Interest and Sugar Prices etc. have not been followed. |
2) Recommendations of various Committees viz., Shri. L.K. Jha, Dr. Ashok Mitra, Dr. S.R. Sen, Prof. C.H. Hanumantha Rao and Prof. Alagh under costs of cultivation scheme have not been implemented while computing costs of cultivation. |
3) The methodology followed, regarding imputing family labour, rental value of land, interest on capital depreciation on fixed assets and agricultural machinery, cost of transportation, marketing charges and storage is not in conformity with recommendations of various Committees and working against the interests of farmers.
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4) Out of total Sugar consumption in the Country only 15% is consumed by individual consumers and 85% by business consumers (Sweet Shops, Soft Drinks, Biscuit and Chocolates manufactures). The norm of availability of Sugar to the consumer at a fair price under Sugarcane Control Order is misinterpreted and Sugar supplied to business consumers under levy scheme. This prevents Sugar Mills to obtain appreciable prices and enable to pay remunerative prices to Sugarcane Farmers.
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5) There is no relevance between the cost of cultivation and SMP fixed.
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6) The production cost of Sugarcane is estimated at Rs. 150/- per qt., during the year 2008-09. As per recommendations of National Commission on Farmers headed by Prof. M.S. Swaminathan, the SMP is required to be fixed by taking all costs incurred by farmer by adding minimum 50% of it (C2+Minimum 50% of it).
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7) Thus SMP is required to be fixed at Rs.215 per qt. (Rs.150+50% i.e. 75), where as the Government has fixed only Rs. 81.18 per qt.
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8) The GOI has announced increased MSP for all other commodities during the year 2008-09 ranging from 15 to 40%. But conspicuously the SMP for Sugarcane has not been increased.
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9) When Sugarcane is crushed the output will be Sugar, Bagas, Molasis and Pressmud. The price of sugar alone is adopted while fixing SMP. The returns from Bagas, Molasis and Pressmud is not taken into consideration while computing SMP. |
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1) The recommendation of Prof. Alagh Committee for considering harvesting, transport and marketing charges be included in cost of cultivation and transparency exhibited in obtaining, computing and analyzing cost of cultivation data from grass root level. |
2) The Whole system be reviewed, transparent procedures, methodology evolved for obtaining costs of cultivation data by Director of Statistics and Economics for analysation by Commission for Agriculture Costs and Prices. The CACP be strengthened by inducting more Farmers representatives including women by granting autonomous status. |
3) Sugar required for individual consumers alone be procured under levy scheme. The business consumers can as well purchase sugar from open market so that Sugar Mills fetch economical price and enable to offer remunerative price to Sugarcane Farmers.
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4) SMP should be all costs actually incurred by Farmers by adding minimum 50% to it i.e. (C2+Minimum 50% of it) as recommended by National Commission on Farmers headed by Prof. M.S. Swaminathan.
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5) CIFA demands SMP of Rs.215 per qt. (Rs.150+50% i.e. 75).
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6) Formula-based pricing be introduced. Cane price linked to prices of sugar and primary byproducts (molasses and surplus bagasse) and to average recovery.
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7) Prices be determined using a fixed formula based on region specific variations. |
8) Incentives be given for varieties with high sucrose content and for early and late maturing varieties. |
9) Minimum support prices be announced to protect farmers from subsistence risk. |
10) The returns from Bagas, Molasis and Pressmud be taken into consideration while computing SMP. |
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b) Fixation of Sugar recovery percentage |
Sugarcane of different qualities is crushed by the sugar factories. Thus, farmer to farmer recovery percentage is not arrived at. The out dated technologies adopted by sugar factories affecting the sugar recovery rate.
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In the case of milk, fat percentage is arrived, farmer wise. Similar procedure be adopted for arriving sugar recovery rate through refractometre. |
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c) i) Payment to the
sugarcane growers.
ii) “L” Profits and
distribution.
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1) As per sugarcane control order 1966, the sugarcane payments be made within 14 days from the date of sugarcane delivery. But the sugar factories violating the norm and effecting payment with abnormal delay. |
2) “L” Profits arrived are unilateral. For arriving and disbursing “L” profits the GOI and Sugar factories respectively, adopting abnormal delay. Inspite of Bhargava Committee recommendations for quick payment, no payment are made.
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1) Sugarcane control order 1966 be amended to facilitate instant payment. In case of delay the dues be paid with interest.
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2) Bhargava Committee recommendations be implemented and “L” Profit disbursed to farmers immediately. |
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d) By-products,
co-generation, ethanol manufacturing |
Sugar factories are expected to go in for cogeneration and manufacture of ethanol for improving economic conditions of mills and enable to pay remunerative price to Sugarcane Farmers in time. |
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Sugarcane control order 1966 be amended stipulating manufacture of minimum of 5 bi-products by all sugar factories to enable to improve economic conditions of mills and pay remunerative price to Sugarcane Farmers in time. The Sugar Mills be converted as sugar complexes by offering incentives under PPPs Scheme. |
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e) Sugarcane development fund.
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Sugarcane development fund is intended for providing soft loans to Sugarcane Farmers and infrastructure development. But, unfortunately this fund is not utilized for the above purposes. |
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The procedure for sanctioning loans under sugarcane development fund be simplified and loans provided to sugarcane farmers at nominal rate of interest. |
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f) Research
i) High yielding seed.
ii) Short duration crop
iii) Tissue culture
iv) Mechanization |
1) No such new varieties are invented. |
2) Wages of agricultural labour are abnormally increased, resulting increase in cost of cultivation, crop management, harvesting and transport charges. Unless innovative agriculture implements are invented from planting to harvesting in sugarcane the economic conditions of sugarcane farmers will be badly affected. Innovative implements, human, animal and mechanical drawn are the necessity of the day to reduce cost of cultivation and physical drudgery. Innovative implements facilitate hassle free and timely completion of sugarcane operations from planting to harvesting. |
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1) Research be strengthened for inventing high yielding seed, short duration and moisture resistant varieties. Industry and farmers be involved in research process by offering incentives under PPPs Scheme. |
2) Innovative implements, human, animal and mechanical drawn be manufactured and provided to Sugarcane farmers at subsidized prices by offering incentives to manufacturers under PPPs Scheme. |
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The premium is on high side. All risks are not covered. Procedures adopted for indemnifying losses are against the interests of farmers. |
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The premium be reduced, subsiding by Govt. as in the case of other countries. Cumbersome procedures adopted for indemnifying losses be reviewed and crop losses indemnified as in other sectors. All risks including loss from wild animals be included. |
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h) i) Status of food
processing industry to
Sugar Industry.
ii) Liberalization of
Sugar Industry |
1) The sugar is an essential commodity. The sugarcane industry be given the status of food processing industry so that all incentives can be availed by sugarcane industry and enable to pay remunerative prices to sugarcane farmers. |
2) Regulations under Sugar Levy Scheme and Essential Commodity Act plays negative role in obtaining better prices by Sugar Industries and offer remunerative prices to Sugarcane farmers. |
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1) Status of food processing industry be given to Sugar industry. |
2) As recommended by Mahajan Committee levy sugar scheme be scraped and Sugar for PDS requirements source from free market. Sugar be removed from Essential Commodity Act. |
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i) Removal of Sugar release mechanism. |
The unstable Sugar release mechanism results over supply in the market and contribute for price fall. This will directly affect Sugarcane farmers in obtaining remunerative prices. |
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Monthly release mechanism be removed. An independent organization be created for managing sustainable sugar price. |
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j) Non-Implementation of recommendations of
i) Bhargava
Commission (1974)
ii) Mahajan Committee
(1998)
iii) Tuteja Committee
(2004) |
1) The recommendations made by Committees appointed for development of Sugar Industry and looking welfare of Sugarcane farmers have not been honoured and implemented. |
2) The Farmers Associations are of the view that Committees are appointed only to side track the issues since the latest Committee appointed under the Chairmanship of Dr. Thorat has not consulting the Sugarcane Farmers Associations even after lapse of about 1 year. There is no farmers representations in the Committeee
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1) Recommendations of various Committees be implemented immediately. |
2) Farmers representatives be included in the Committee headed by Dr. Thorat and immediate steps be initiated for bailing out Sugarcane sector from crisis and provide relief to Sugarcane Farmers.
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| 2. MINISTRY OF FINANCE |
a) Credit
i) Plantation Crop
ii) Ratoon crop.
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- The amount of loan sanctioned per acre differs from Rs. 12,000/- to Rs. 18,000/-
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- The amount of loan sanctioned per acre differs from Rs. 10,000/- to Rs. 15,000/-
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Scale of finance per acre be fixed depending on the actual cost of cultivation ranging from
Rs. 25,000/- to Rs. 30,000/-. |
Scale of finance per acre be fixed depending on the actual cost of cultivation ranging from
Rs. 20,000/- to Rs. 25,000/-. |
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| b) Rate of Interest |
Different banks are adopting different rates of Interest ranging from 7% to 14%. |
Uniform rate of Interest of 4% be fixed. |
| c) Levy of multiple taxes |
The GOI is collecting excise duty and other taxes on various bi-products. Collection of multiple taxes at various stages is coming in the way of paying remunerative price to sugarcane growers by sugar factories. |
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Collection of multiple taxes be scraped. |
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Sugar Imports & Exports
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Sugar export and import policy is not based on demand and supply basis. The short term policies adopted are benefiting importers, exporters, middle-men and the farmers are put to incurring repeated losses.
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| The long-term import and export policy be evolved based on the supply and demand position for protecting the interests of farmers. |
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CONSORTIUM OF INDIAN FARMERS ASSOCIATIONS, NEW DELHI