A committee of ministers headed by Chief Minister Devendra Fadnavis decided to begin the crushing operations in Maharashtra from November 1.
The decision is likely to keep sugar prices firm during the festival season, though industry executives claim there will be no shortage of the commodity.
The central government has been urging mills to begin crushing in the first week of October to ensure there’s enough supply of the commodity during the fes tival period and prices remain in check. Sugar mills in Maharashtra normally begin crushing operations in the first week of November while their counterparts in Uttar Pradesh do it in the second half of the month.
Those in Maharashtra had earlier agreed to advance the crushing operations to the first half of October, provided the central government gave Rs 500tonne of cane crushed as compensation. The compensation was for the losses, they claimed, they would have to bear in sugar production as cane has less sucrose content in the month of October.
However, when the central government refused, the mills said they will begin operations only after Diwali. “We will not be able to bear the losses in sugar production by starting the operations too soon,“ said BB Thombre, president, Western Indian Sugar Mills Association. Analysts expect sugar prices to remain supported till mid-November.According to data from the consumer affairs ministry, wholesale sugar prices across the country have been higher by 40-50 per cent as compared with prices two years ago -up from Rs 27kg to about Rs 40kg. In the last one year, pri` ces have been stable at Rs 36-40kg at the mill gates and Rs 45kg in retail, as the government wants sugar mills to earn profits and clear cane price arrears.
Sugar mills in UP too have decided to begin production in the last week of October, due to increased output of sugarcane.“Area under sugarcane has increased by 11-12 per cent. The losses that we will have to bear by advancing crushing operations will be lower than losses mills will have to bear if they cannot empty the fields till MayJune,“ said an industry representative from UP.
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