Maharashtra sugar production drops, impacting farmers' payments

Maharashtra's sugar industry is facing a serious crisis this year. Sugar production has dropped by about 3 million tonnes compared to last year. The state is expected to produce only 8 million tonnes of sugar, down from 11 million tonnes last year. Sanjay Khatal, managing director of the Maharashtra State Co-Operative Sugar Factories Federation Ltd, said only 30 factories are still operating. Most of the 170 factories have finished their crushing processes. This situation makes it hard for sugar factories to pay fair prices to cane farmers. Several factors are causing this financial crisis. Annual hikes in the fair and remunerative price (FRP) for sugarcane, increasing transportation costs, and low sugar content in cane due to climate change are key issues. The federation has asked the government for help with loan repayment and restructuring. The letter to government officials highlighted that the FRP is set at ₹3,400 per tonne based on a sugar recovery rate of 10.25%. However, the recovery rate has dropped by 0.7% this year. Meanwhile, the minimum support price (MSP) for sugar has not changed since 2019—it remains at ₹31 per kg. Around 132 sugar factories are struggling to pay farmers their due amounts, leading the federation to request a soft loan scheme from the state government. They also suggest extending loan terms to ten years and increasing the MSP to ₹40.51 per kg. Harshwardhan Patil, chairman of the National Federation of Cooperative Sugar Factories, shared similar concerns. He stated that sugar factories usually need to operate for at least 140-150 days a year to remain financially viable. This year, the average season lasted only about 83 days, which is not sustainable for the industry.