UP sugar output down 7% year on year, cane dues rise to Rs 8,400 crore

The drop in yield is mostly due to the shift to ethanol production, although increased disease and pest infestation have also had an influence.

In the 2021-22 season, sugar production in Uttar Pradesh, the country’s second-largest producer after Maharashtra, fell by 7.3 percent year on year to 10.24 million tonne (MT).

The decrease in yield is mostly due to the shift to ethanol production, although increased disease and pest infestation have also had an impact. The sugar recovery has been gradually decreasing as well. While the recovery was at a record high of 11.46 percent in 2018-19, it dropped to 11.30 percent in 2019-20 and 10.76 percent in 2020-21. This year, it has failed to reach 10.10 percent, owing primarily to warmer-than-expected weather.

Meanwhile, the state’s sugar crushing season has ended for the 2021-22 season, with mills clearing just over 76 percent of their cane dues to farmers.

According to statistics obtained by FE, the 120 mills that worked this season had paid Rs 26,630 crore in cane dues as of June 3, with Rs 8,378 crore still owed. The state’s 93 private sugar mills have cleared 78 percent of their debts but still owe around Rs 6,995 crore. While the 24 UP Cooperative sugar mills have paid 60 percent of their debts but still owe Rs 1,161 crore. The three mills of the Uttar Pradesh Sugar Corporation have paid 48 percent of their debts but still owe Rs 222 crore.

Among the private millers, four sugar businesses owed more than half of the state’s total dues: Bajaj Hindustan, Modi Sugars, Simbhaoli Group, and Yadu Group. The highest defaulter in the state is Bajaj Hindustan. Which operates 14 factories and owes Rs 3,200 crore, while the Modi Group’s two plants owe Rs 686 crore. The Simbhaoli Group had Rs 583 crore in debt, while the Yadu Group owed Rs 126 crore.

Many private sugar mills have paid off all of their cane debts. Balrampur Chini, DCM Shriram, Dalmia, Dhampur, Dwarikesh, and Triveni have all paid their debts in full. While Birla Group and IPL have paid roughly 96 percent of their debts. Others, such as Uttam Sugars, Wave Group, and Mawana, have received over 80% of their cane payments. Individual mills like Parsendi and Biswan, Tikaula and Pilibhit, as well as larger groupings, have cleared their complete cane dues.

A miller who requested anonymity said the backlog in clearing dues. By certain private millers has become a recurring problem with these companies. Who roll over cane payments to the next season. “Every year, a few of defaulter mills sabotage all of the advancing mills’ hard work. What’s more concerning for the sector is the fact that the state government. Often overlooks the mismanagement of a few defaulters. “No action is taken against them. Which puts a damper on those who work hard to keep their records clean”. A mill owner who asked to remain anonymous said.

Surprisingly, just 60% of the state’s 24 cooperative mills have paid their dues. These 24 mills have arrears of Rs 1,161 crore on their total cane dues of Rs 2,962 crore, while the three mills of UP Sugar Corporation have cleared only 48 percent of their dues and still owe Rs 222 crore. According to sources, the majority of the cooperative mills are outdated. And losing money, requiring the state government to step in and clear the farmers’ cane debts. As well as pay for their maintenance.

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