Centre approves hike in sugarcane FRP by Rs 25 to Rs 340 per quintal

The government on Wednesday, 21 February decided to hike the minimum price that mills have to pay to sugarcane growers by Rs 25 to Rs 340 per quintal for the 2024-25 season starting October.

This is the highest Fair and Remunerative Price (FRP) for sugarcane announced by the Prime Minister Narendra Modi-led government since coming to power in 2014. In terms of quantum, this is the second time that the Modi government has increased the FRP by Rs 25 per quintal in one go.

The decision to increase the FRP was taken at the meeting of the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister Narendra Modi. It also comes ahead of the general elections.

Sugarcane is grown mainly in Maharashtra, Uttar Pradesh, and Karnataka.

The CCEA approved the FRP of sugarcane for 2024-25 at Rs 340 per quintal at sugar recovery rate of 10.25 per cent, Information and Broadcasting Minister Anurag Thakur told reporters.

"This is a historic price of sugarcane which is about 8 per cent higher than FRP of sugarcane for current season 2023-24," he added.

The new FRP is 107 per cent higher than A2+FL cost of sugarcane, Thakur said, adding that this would ensure prosperity of sugarcane farmers.

"India is paying the highest price of sugarcane in the world," the minister asserted.

The revised FRP will be applicable with effect from October 1, 2024.

The FRP has been determined on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP).

"This decision of central government is going to benefit more than 5 crore sugarcane farmers (including family members) and lakhs of other persons involved in sugar sector," an official statement said.

With the CCEA approval, sugar mills will pay FRP of sugarcane at Rs 340 per quintal at recovery of 10.25 per cent.

With each increase of recovery by 0.1 per cent, farmers will get additional price of Rs 3.32 while the same amount will be deducted on reduction of recovery by 0.1 per cent.

However, Rs 315.10 per quintal is the minimum price of sugarcane which is at recovery of 9.5 per cent.

In the last 10 years, the government said it has ensured that farmers got the right price for their crop in right time.

"99.5 per cent cane dues of previous sugar season 2022-23 and 99.9 per cent of all other sugar seasons are already paid to farmers leading to the lowest cane arrears pending in history of sugar sector," the government said.

Thakur said more than 80 per cent of total outstanding amount has already been paid to farmers for the current 2023-24 season.

The FRP was Rs 210 per quintal in 2013-14 marketing year, Rs 220 in 2014-15, Rs 230 in 2015-16 and 2016-17. It was Rs 255 in 2017-18, Rs 275 in 2018-19 and 2019-20, Rs 285 in 2020-21, Rs 290 in 2021-22, Rs 305 in 2022-23 and Rs 315 per quintal in 2023-24 marketing year.