Uttar Pradesh government has increased the State Advised Price (SAP) of sugarcane by Rs 10/quintal 

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Previous year from Rs 305/quintal to Rs 315/quintal. Industry has welcomed it, calling it a moderate hike. 

The Uttar Pradesh Government has increased the State Advised Price (SAP) for sugarcane by Rs 10 per quintal for the ongoing crushing season. SAP has been fixed at Rs 325 per quintal for early variety of sugarcane and at Rs 315 per quintal for general variety of sugarcane. 

Uttar Pradesh Sugar Mills Association (UPSMA), which represents UP's sugar industry, said in a release: "The mills view the increase with cautious optimism as the cane price payment capacity of the mills is dependent on the sugar prices which may not remain at the current level after arrival of new sugar as well as increased sugar production for 2018-19 and beyond, materially altering the market sentiment with expectations of a production level of around 290 – 300 lac tonnes." 

"The Industry view has always been that a revenue sharing model be worked out with a long term perspective. UPSMA thanks the government for its willingness to consider the same for forthcoming seasons," it added. 

Vijay S Banka, whole time director, Dwarikesh Sugar IndustriesBSE 0.54 % said, "We welcome the decision of reasonable hike in State Advised Price (SAP) for sugarcane. State Government needs to be lauded for creating a win-win situation for farmers, sugar mills as well as for other industry stakeholders. We feel that the SAP fixed by the Uttar Pradesh Government is reasonable and can be absorbed by sugar industry." 

Uttar Pradesh is expected to have record sugar production in 2017-18 thanks to a new high yielding sugarcane variety. Though the industry is concerned that high sugar production may lead to fall in sugar prices, there by reducing the capacity of the mills to pay sugarcane farmers, UP millers say that they will stand to gain from increased revenue realisation from by products of sugar. 

By BOA Bureau