Sugar mills in Sindh are not motivated enough to start crushing the crop, stating that they cannot operate when the factory-gate price of processed sugar is less than the official sugarcane rate.
Deadlock over price between millers and farmers has now threatened to cast a shadow on other cash crops including wheat as sugarcane stocks pile outside factories and farmers await payment.
After about a fortnight of procastination, the Sindh government has fixed the price of sugarcane at Rs182 per 40kilogrammes (kg) – the support price at which the factories are supposed to buy raw material from farmers under the Sugarcane Control Act.
The sugarcane crushing season in Sindh, which started with a delay of over a month on December 10, has moved at a slow pace. Only 10% of the crop has been converted to sugar by January 5, 2015, against the usual conversion of 50% in as many days, growers say.
A global slump in commodity prices has led to similar problems in sugar-producing countries like India where in some states millers have expressed the same concerns over the officially fixed rate of sugarcane.
Mill owners in Sindh have been criticised for their inflexible attitude especially when their counterparts in Punjab and Khyber-Pakhtunkawa have accepted Rs180 per 40kg as the official sugarcane price.
Farmers do not buy this argument and say that when it comes to input cost they have borne spiralling prices of fertiliser, pesticides, seeds and fuel. While they also accuse the mill owners of making a windfall on molasses, ethenol and other sugarcane by-products.
The country is one of the largest producers of the crop but it has lacked in terms of yield per hectare.Pakistan Sugar Mills Association Chairman Iskander M Khan says that government should give direct subsidy to farmers if it was so concerned about their fate.
“Fact remains that sugarcane price constitutes 85.5% of our total production cost. And we can’t accept the high rates being offered to us.”
