• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Harish Damodaran

New Delhi, Nov. 23 Unlike cotton or soyabean farmers, sugarcane growers seem in a much better bargaining position this time round.

Notwithstanding the ongoing legal battle at the Allahabad High Court, sugar mills in Uttar Pradesh (UP) are more or less reconciled to paying the Rs 140-145 a quintal cane price fixed (‘advised’) by the State Government for the 2008-09 season (October-September).

A dozen or so mills have already commenced crushing operations for the season, while stamping Rs 140-145 as the price in the parchis (weighment slips against cane purchase indents) issued to growers.

The mills are reportedly also mentioning in the parchis that this rate is subject to the Court’s final order.

Private mills in UP had filed a writ petition against the State Advised Price (SAP) in the High Court, for which hearing is currently on.

“What the Court rules on the matter is of academic interest now. Once you pay Rs 140-145 to the farmer, it is impractical to ask him to refund the difference even assuming the Court orders a lower price,” sources pointed out.

According to them, in the coming week, almost all mills will start crushing, while mentioning the same “Rs 140-145 subject to Court order” price condition.

What has surprised many though is the tenacity of growers, who have refused to part with any cane till they received the SAP.

“Unlike last season, this time they have diverted a significant portion of their cane area to paddy and other crops. So, they showed no desperation to sell cane and were willing to play the waiting game, knowing also that this is an election year,” a miller admitted.

The mills, on their part, are more desperate to secure cane supplies, given the overall bullish outlook for sugar despite the global credit crunch.

World sugar output is set to decline by over seven million tonnes (mt) this year, with production trailing consumption for the first time since 2004-05.

The Centre has also recently revised downwards its estimate of domestic sugar production for 2008-09 from 22 mt to 20.5 mt, as against 26.3 mt and 28.3 mt in the preceding two seasons.

More Stories on : Sugar | Outlook

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line