The Cabinet Committee on Economic Affairs (CCEA) on Thursday is likely to consider raising the fair and remunerative price (FRP) for sugarcane for the 2013-14 sugar season by 23.5 per cent to Rs 210 a quintal.
FRP, the benchmark cane price for 2013-14 sugar year, starting October, is linked to a basic recovery rate of 9.5 per cent, subject to a premium of Rs 2.21 a quintal for every 0.1 per cent increase in recovery above 9.5 per cent. For 2012-13, the FRP was at Rs 170.
FRP is fixed by the Centre but there at least five States – Uttar Pradesh, Haryana, Punjab, Uttarakhand and Tamil Nadu – that announce their own rates, called the State Advisory Price (SAP). SAP is higher than FRP.
to help farmers
The proposed hike in FRP, if approved, could help farmers offset the rising cultivation costs, including both labour and fuel.
Planting of sugarcane starts a year-ahead and an early announcement of FRP would help farmers make informed decisions.
The proposed FRP hike would be in line with the recommendation of the Commission for Agriculture Costs and Prices.
sugar output
India is expected to produce about 24 million tonnes (mt) of sugar in the current year, down from 26 mt last year. Domestic consumption of sugar is pegged at 22 mt.
Sugar output till mid-January is up by about 3 per cent at 10.8 mt aided by higher cane crushing in Karnataka and Maharashtra. In the corresponding period last year, sugar output stood at 10.5 mt.
Edible oils
The CCEA is also expected to consider allowing export of edible oil from the domestic tariff area (DTA) to special economic zones.
Besides, it is also likely to consider allowing export of coconut oil and permit the export of edible oils with a minimum export price (MEP) of $1,500 a tonne in branded consumer packs of up to 5 kg without any quantitative restrictions.
In October last year, the Government had permitted export of edible oils in branded consumer packs of up to 5 kg with a ceiling of 20,000 tonnes to meet the growing demand from overseas Indians.