Union Cabinet Hikes Sugarcane FRP By Rs 10/Quintal To Rs 315/Quintal

The central government on Wednesday hiked sugarcane Fair and Remunerative Price (FRP) by Rs 10/quintal to Rs 315/qtl for the 2023-24 season, said I&B Minister Anurag Thakur.

In the current sugar season 2022-23, about 3,353 lakh tons of sugarcane worth Rs 1,11,366 crore was purchased by sugar mills.

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The central government on Wednesday hiked sugarcane Fair and Remunerative Price (FRP) by Rs 10/quintal to Rs 315/qtl for the 2023-24 season, said I&B Minister Anurag Thakur. This decision was made during a meeting of the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi. Last year, the FRP for sugarcane was Rs 305 per quintal.

#WATCH | Delhi: The cabinet has approved the highest ever Fair and Remunerative Price of Rs.315/qtl for Sugarcane Farmers for sugar season 2023-24. The decision to benefit 5 crore sugarcane farmers and their dependents, as well as 5 lakh workers employed in the sugar mills and… pic.twitter.com/mW5RgQZIl9

— ANI (@ANI) June 28, 2023

The decision to benefit 5 crore sugarcane farmers and their dependents, as well as 5 lakh workers employed in the sugar mills and related ancillary activities, Thakur said. He further said that the government prioritizes agriculture and farmers, and this increase in FRP demonstrates support for them. The FRP has steadily increased over the years, from Rs 210 per quintal in the 2014-15 season to the current Rs 315 per quintal for the 2023-24 season.

"Keeping in view interest of sugarcane farmers (GannaKisan)," the Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi has approved Fair and Remunerative Price (FRP) of sugarcane for sugar season 2023-24 (October- September) at Rs.315/qtl for a basic recovery rate of 10.25 per cent, a CCEA press statement said. 

It has also been approved to provide a premium of Rs.3.07/qtl for each 0.1 per cent increase in recovery over and above 10.25 per cent, and reduction in FRP by Rs.3.07/qtl for every 0.1 per cent decrease in recovery, it added. 

Further, with a view to protecting the interest of sugarcane farmers, the government also decided that there shall not be any deduction in the case of sugar mills where recovery is below 9.5 per cent. Such farmers will get Rs 291.975/qtl for sugarcane in the ensuing sugar season 2023-24 in place of Rs 282.125/qtl in the current sugar season 2022-23, the statement said. 

The government also informed that the Fair and Remunerative Price (FRP) for sugarcane in the upcoming sugar season 2023-24 at Rs. 315 per quintal is 100.6 per cent higher than the production cost of Rs 157 per quintal, based on a recovery rate of 10.25 per cent. It is also 3.28 per cent higher than the FRP of the current sugar season 2022-23.

The approved FRP will be applicable for the purchase of sugarcane from farmers by sugar mills during the sugar season 2023-24, starting from October 1, 2023.

The sugar sector plays a crucial role in the livelihoods of around 5 crore sugarcane farmers and their dependents, as well as approximately 5 lakh workers directly employed in sugar mills. It also supports various ancillary activities such as farm labor and transportation.

The FRP is determined based on recommendations from the Commission for Agricultural Costs and Prices (CACP) and after consultation with state governments and other stakeholders. The government has been announcing the FRP since the sugar season 2013-14.

The Cabinet also approved a new scheme PM-PRANAM to incentivise states to promote alternative fertilisers, said Fertiliser Minister Mansukh Mandaviya. The government also gave approval to set up a National Research Foundation through an act of parliament. 

During the press brief, I&B Minister Anurag Thakur also informed that in the current sugar season 2022-23, about 3,353 lakh tons of sugarcane worth Rs 1,11,366 crore was purchased by sugar mills, which is the second highest next to the procurement of paddy crop at Minimum Support Price.

He also said that the growth of ethanol as a biofuel sector in the last 5 years has amply supported the sugarcane farmers and sugar sector, as diversion of sugarcane/sugar to ethanol has led to better financial positions of sugar mills due to faster payments, reduced working capital requirements and reduced blockage of funds due to less surplus sugar with mills, thereby enabling them to make timely payment of cane dues of farmers.

"During 2021-22, revenue of about Rs.20,500 crore has been generated by sugar mills/distilleries from sale of ethanol to OMCs which has enabled them to clear cane dues of farmers," the government statement said.