The Hindu Business Line : Sugarcane area may shrink in key States

"Sowing has begun in Maharashtra and other states. Due to dry conditions, the coverage is lower than last year," said Mr Vinay Kumar, Managing Director, National Federation of Cooperative Sugar Factories Ltd. "We expect the area under sugarcane to decline in Tamil Nadu and Karnataka too," he said.

According to the Agriculture Ministry, sowing of kharif crops, including sugarcane, has begun. Currently, 32.4 lh have been covered under sugarcane against 39.4 lh during the same period last year.

Mr Kumar said the view of some of the private millers in Uttar Pradesh was that the area under sugarcane could go up by 10 per cent.

Asked if the recent Supreme Court ruling upholding the state governments' powers to fix a higher price for sugarcane as against the statutory minimum price fixed by the Centre would lead to a rise in the area under the crop, he said it was too early to comment.

"First of all, farmers would not go in for sugarcane unless they get a higher price. Also, nothing is clear on the apex court ruling on old dues," Mr Kumar said.

"Only good and timely rains will lead to higher production. That will result from the ratoons yielding higher," he said. Ratoons are stems of sugarcane that are not cut fully. Usually, two or three ratoons are derived from sugarcane.

Last year, the area under sugarcane declined to 42 lh from 43 lh the previous year. Of this, sowing in Uttar Pradesh alone accounts for a little over 19 lh. Maharashtra, Karnataka and Tamil Nadu together account for another 13 lh.

Sugar production this season (October 2003-September 2004) is projected to decline to around 170 lakh tonnes from 200 lakh tonnes the previous year. The decline in production is due to drought in South India and parts of Maharashtra. Also, farmers tended to grow other crops in view of poor returns during 2002-03 and outstanding dues from the mills.

A section of the industry fears that the production could decline further next season, though millers in Uttar Pradesh are trying to woo farmers to grow sugarcane by offering them various incentives.