Sugar price drops, mills under economic crises

Gorakhpur, July 8 (UNI) Even as the year was marked by the increase in sugar production, continous drop in sugar price has posed Uttar Pradesh sugar mills to breath under economic crisis.

According to the mill owners, selling sugar at lower price is affecting both the farmers and the mill.

Solely in the Gorakhpur division, their are 26 mills of which 19 are working in a sound state.

The production of sugar this year was 23,16,608 bags, whereas last year it was 21,65,297 bags.

Even the boost in production could not meet the demands of the farmers, these mills owe Rs 140 crore to farmers, who had supplied sugarcane worth Rs 513 crore, but received the payment of Rs 373 crore only.

Senior official of the mill told UNI that the market cost of one bag of sugar was estimated at Rs 1600-1700, but the market cotted Rs 1200-1300 per bag. This had worsened the state of farmers, who were expecting good earning this year.

Gorakhpur Sardar Nagar sugar mill official said government had increased the purchase price of sugarcane, but not of sugar. This had posed hardship to both the farmers and the mill owners, as the raw material is purchased in high price but the product is sold in low price.

He apprised that the mill had paid Rs 29 crore to farmers against their supply of Rs 38 crore sugarcane.

Babhnan sugar mill, Basti Sugar mill and Gadora mill owe Rs 34 crore, Rs 29 crore and Rs 25.96 crore respectively to farmers.

Meanwhile, Gadora mill general manager said the production cost of each sugarcane bag was Rs 1,600, however it was sold for Rs 1,275.

He said the sugar mills that exploits the byproduct can only afford to continue in loss, whereas others have to search for an alternative.

UNI