The Union Cabinet is likely to take up hiking sugarcane's FRP (fair & remunerative price) by Rs 5 per quintal, CNBC TV18 reported.
The Cabinet Committee on Economic Affairs (CCEA) is expected to take up the price increase for sugarcane in its meeting scheduled on August 25.
The Centre in August 2020 increased the fair & remunerative price by Rs 10, bringing the amount to Rs 285 per quintal. The government fixed Sugarcane FRP at Rs 275 per quintal for the 2019-2020 marketing year.
The FRP in India has been fixed in line with the recommendation of the Commission of Agricultural Costs and Prices (CACP), a statutory body that advises the government on the pricing policy for major farm produce.
The decision to hike the FRP on sugarcane comes ahead of the Legislative Assembly elections in Uttar Pradesh next year which is a major sugarcane producing state.
Major sugarcane producing states such as Uttar Pradesh, Punjab and Haryana fix their own sugarcane price called 'state advisory prices' (SAPs), which are usually higher than the Centre's FRP.
On August 19 this year, Punjab Chief Minister Amarinder Singh had approved a Rs 15 per quintal hike in the SAP of all sugarcane varieties for the 2021-22 crushing season.
Business Standard in July had reported that sugarcane dues accruing to farmers have risen to almost Rs 21,321 crore as of May 2021 and of the pending sugar cane dues for 2020-21, almost 63 percent accrues to Uttar Pradesh.
Earlier this year, there have been reports suggesting that sugarcane producers in the state of Karnataka have demanded an increase in the FRP for the crop commensurate with the cost of cultivation for 2021-22.
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