Industry body ISMA has urged the Food Ministry to increase the Minimum Selling Price (MSP) of sugar to Rs 36-37 per kg from the existing Rs 31 per kg. ISMA has made this demand citing increase in the cost of production. Indian Sugar Mills Association (ISMA) President Aditya Jhunjhunwala has said in a letter to the Food Secretary that the MSP of sugar is important for paying the Fair and Remunerative Price (FRP) fixed by the Centre. FRP is the minimum price that mills have to pay to sugarcane farmers to buy sugarcane.
ISMA said that at present the all-India ex-mill prices of sugar are around Rs 33-34 per kg, while the ex-mill prices in major sugar producing states like Maharashtra and Karnataka are lower by around Rs 32-22 per kg. Jhunjhunwala said, “…the current ex-mill prices are much lower than the cost of production of around Rs 36-37 per kg at the current FRP. We request that by adding MSP of sugar with FRP of sugarcane, the MSP of sugar may be increased by about Rs.36-37 per kg.’
Sugarcane FRP has been increased by Rs 15
ISMA said about 85 per cent of the revenue comes from the sale of sugar and hence it is important for mills to be able to pay FRP to cane farmers. The association said the Center has been fixing the MSP of sugar since June 2018, which was revised to Rs 31 per kg in February 2019, when the FRP of sugarcane was Rs 275 per quintal. Since then, the FRP of sugarcane has been increased twice by a total of Rs 15 per kg, but the MSP has not been increased. The FRP for the year 2021-22 is Rs 290 per quintal.
In fact, the Narendra Modi government at the Center has announced to increase the FRP of sugarcane by Rs 15 for the sugarcane season 2022-23 starting from October. This decision was approved in the Cabinet Committee on Economic Affairs on Wednesday. After this announcement, the minimum price to be paid by sugar mills has been increased by Rs 15 to Rs 305 per quintal. More than 5 crore farmers cultivate sugarcane in India. Also, lakhs of people are indirectly connected with it.
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