But for the favourable court orders, the farmer would surely have perished by now
VM Singh
Convener, Rashtriya Kisan Mazdoor Sangathan
The price of sugar has nearly doubled in the last 12 months: from Rs 18 per kg to Rs 34. So who is to blame? Those who hold the farmer responsible and allege that he is holding the mills to ransom don’t know what they are talking about. Just consider: Last year sugarcane in UP sold at Rs 140 per quintal; and the year before that the mills paid Rs 110 against the “state advised price” of Rs 125. During the corresponding period in the last two years its price hovered between Rs 12 and Rs 18 per kg.
The fact is that even when the mills paid Rs 140 for a quintal of sugar, and its price ranged between Rs 16 and Rs 18 per kg, they made huge profits. The entire stock in the country, whether it is with the miller or the government, consists of sugar manufactured from cane cost Rs 140. If you ask me the culprit is none else but the government which has done nothing to arrest the spiralling prices, and quietly allowed mill owners to double them. The Sugar Control Order and the Sugarcane Control Order framed under Section 3 of the Essential Commodities Act empower the government to fix the prices of sugar and sugarcane. The government never has a problem fixing the price of the latter – it is only when it comes to sugar that its complacency becomes visible. The Central government should have fixed the price of sugar at Rs 18 per quintal – which was the market price when crushing operations closed; though even at this price the mills have made huge profits in recent years.
Sugar only accounts for 50 to 60 per cent of the revenue that the mills earn from sugarcane. But the government looked on passively even when mill owners were selling sugar for Rs 34 per kg. And this despite the fact that the manufacturing rate during the season was between Rs 10 and Rs 12 per kg, and the mills made huge profits selling sugar for Rs 18 per quintal. It is extremely unfortunate that the mills are being allowed to import raw sugar to offset this year’s reduced sugarcane supply. The government never intervened when there was excess cane and the farmer was left with no other option than to burn it.
In the past 15 years the mills have often been reduced to begging the farmer to plant more sugarcane. But when it is payback time, the deadline is never met. So why is the government allowing the mill owners to import raw sugar? – a move that can only make them more complacent? For, if that happens, they will be able to do without the farmer. Does the government know how suicidal this act is? Fine, the mills have been bailed out. But is it realised that the farmer too is going to be tempted to reduce the sugarcane growing area?
If the government intervenes, it must stand up for both the farmers and the mill owners. Consider that every time the farmers grow excess cane at the millers’ request, the latter take advantage of it and bring down the rate. They do this by getting their agents to supply the cane to them at half the rates.
What we urgently need is a clear policy to regulate sugarcane output. I have been fighting for the rights of sugarcane farmers in the SC and the high courts for the past 15 years. In its counter-affidavits the government admitted that the area of sugarcane cultivation having shrunk drastically, the output too was bound to fall. Yet at the same time the government opened up export of sugar and reduced its buffer.
In 1995-96 the government exported sugar to Pakistan through the State Trading Corporation, and the following year due to shortages the same sugar was imported back! Farmers are bound by the cane price fixed by the state governments, and even for that they have to go in for extensive litigation. There are mills that have still not paid the arrears of 2003-04. In 2006-07 when the cane price was Rs 125 per quintal, the mills wanted to pay just Rs 80.25 per quintal. It was only after the SC intervened that the full payment was made. Instead of the SAP of Rs 125 per quintal the mills wanted to pay Rs. 81.31 per quintal, but ended up paying Rs. 110 per quintal after the apex court order.
VM Singh
Convener, Rashtriya Kisan Mazdoor Sangathan
The price of sugar has nearly doubled in the last 12 months: from Rs 18 per kg to Rs 34. So who is to blame? Those who hold the farmer responsible and allege that he is holding the mills to ransom don’t know what they are talking about. Just consider: Last year sugarcane in UP sold at Rs 140 per quintal; and the year before that the mills paid Rs 110 against the “state advised price” of Rs 125. During the corresponding period in the last two years its price hovered between Rs 12 and Rs 18 per kg.
The fact is that even when the mills paid Rs 140 for a quintal of sugar, and its price ranged between Rs 16 and Rs 18 per kg, they made huge profits. The entire stock in the country, whether it is with the miller or the government, consists of sugar manufactured from cane cost Rs 140. If you ask me the culprit is none else but the government which has done nothing to arrest the spiralling prices, and quietly allowed mill owners to double them. The Sugar Control Order and the Sugarcane Control Order framed under Section 3 of the Essential Commodities Act empower the government to fix the prices of sugar and sugarcane. The government never has a problem fixing the price of the latter – it is only when it comes to sugar that its complacency becomes visible. The Central government should have fixed the price of sugar at Rs 18 per quintal – which was the market price when crushing operations closed; though even at this price the mills have made huge profits in recent years.
Sugar only accounts for 50 to 60 per cent of the revenue that the mills earn from sugarcane. But the government looked on passively even when mill owners were selling sugar for Rs 34 per kg. And this despite the fact that the manufacturing rate during the season was between Rs 10 and Rs 12 per kg, and the mills made huge profits selling sugar for Rs 18 per quintal. It is extremely unfortunate that the mills are being allowed to import raw sugar to offset this year’s reduced sugarcane supply. The government never intervened when there was excess cane and the farmer was left with no other option than to burn it.
In the past 15 years the mills have often been reduced to begging the farmer to plant more sugarcane. But when it is payback time, the deadline is never met. So why is the government allowing the mill owners to import raw sugar? – a move that can only make them more complacent? For, if that happens, they will be able to do without the farmer. Does the government know how suicidal this act is? Fine, the mills have been bailed out. But is it realised that the farmer too is going to be tempted to reduce the sugarcane growing area?
If the government intervenes, it must stand up for both the farmers and the mill owners. Consider that every time the farmers grow excess cane at the millers’ request, the latter take advantage of it and bring down the rate. They do this by getting their agents to supply the cane to them at half the rates.
What we urgently need is a clear policy to regulate sugarcane output. I have been fighting for the rights of sugarcane farmers in the SC and the high courts for the past 15 years. In its counter-affidavits the government admitted that the area of sugarcane cultivation having shrunk drastically, the output too was bound to fall. Yet at the same time the government opened up export of sugar and reduced its buffer.
In 1995-96 the government exported sugar to Pakistan through the State Trading Corporation, and the following year due to shortages the same sugar was imported back! Farmers are bound by the cane price fixed by the state governments, and even for that they have to go in for extensive litigation. There are mills that have still not paid the arrears of 2003-04. In 2006-07 when the cane price was Rs 125 per quintal, the mills wanted to pay just Rs 80.25 per quintal. It was only after the SC intervened that the full payment was made. Instead of the SAP of Rs 125 per quintal the mills wanted to pay Rs. 81.31 per quintal, but ended up paying Rs. 110 per quintal after the apex court order.
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