The three continuous years of stagnant production and price are taking a toll on the sugarcane industry in the State as farmers are reluctant to expand cropping area. Sugar mills too are not keen on encouraging farmers as prevailing sugar prices cannot support a higher price for cane.

According to industry estimates, the sugarcane production for 2016-17 season (October-September) is pegged at about 150 lakh tonnes (lt) with 102 lt in the private sector and about 50 lt with the co-operative sector.

This is marginally higher than the 138 lt in the current 2015-16 season. As of April 2016, the sugar production was 9.9 lt in the current season compared with 2014-15’s 9.27 lt.

Ratoon crop One clear indication of the lack of farmers’ enthusiasm is the area of the ratoon crop — the off shoot that grows after the standing sugarcane is harvested — is nearly double that of new planting.

Over the last three years, the mills have paid farmers about ₹ 2,300 plus transport cost for a tonne for cane as sugar prices have not supported a higher cane price.

Higher costs Over the last couple of years sugar prices had dipped to lows that resulted in mills losing money on every tonne of cane crushed. With sugar prices ruling at ₹33/kg, sugar mill representatives say they are at just above breakeven levels.

In the current season, sugarcane harvesting costs had hit a high of about ₹600 a tonne which is more than 25 per cent of what the farmers get for sugarcane. Shortage of local labour resulted in mills bringing farm labourers from Karnataka and Maharashtra, where the sugarcane season ended earlier, they said. With sugar prices continuing at unviable levels, mills are also not keen on providing incentives to farmers to expand sugarcane areas. In earlier years, they have been known to distribute sugarcane setts (seedlings) free and providing cash advances.

TN scenario As things stand, sugar industry in Tamil Nadu does not have much to look forward to in terms of a significantly higher output in the coming season given the current crop status.

However, there is scope for optimism in the 2017-18 sugar season (October-September). By October this year some clarity is expected.

For that, the monsoon should be normal and sugar prices pick up in the wake of an anticipated drop in domestic production, which will pave way for higher cane prices and spark farmers’ interest in the crop.

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