Cabinet approves hike in sugarcane procurement price to Rs 340 per quintal for 2024-25 season

The Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, met in the evening of February 21.

The Cabinet Committee on Economic Affairs, on February 21, approved a hike in the Fair and Remunerative Price (FRP) of sugarcane to Rs 340 per quintal from Rs 315 per quintal for the 2024-25 (October-September) season.

The Rs 25-per-quintal increase in the FRP of sugarcane is significantly higher than what was announced last year, when the government had raised it by Rs 10 per quintal to Rs 315.

Also Read: Farmers' protest standoff – why agitators turned down Centre's MSP proposal

The decision to hike the FRP of sugarcane in February is unusual considering the season begins in October and comes amid the 'Delhi Chalo' protests by farmers, with the government involved in talks with them over their demands.

In 2023, the decision on sugarcane FRP was announced in June. Before that, in 2022, it was announced in August. In 2019, when the last Lok Sabha elections were held, the government had announced the sugarcane FRP for the 2019-20 season in July and had left it unchanged from the previous season.

"India is paying the highest price for sugarcane in the world. Even this year, the Modi government has announced a hike of 8 percent. This is in the interest of farmers," Union Minister Anurag Thakur said on February 21 after the Cabinet meeting.

"This decision of Central Government is going to benefit more than 5 crore sugarcane farmers (including family members) and lakhs of other persons involved in sugar sector. It re-confirms fulfilment of Modi ki Guarantee to double farmers' income," the government said in a statement.

As per the Cabinet decision, the basic sugar recovery rate remains unchanged at 10.25 percent at the higher FRP. Further, the premium for every 0.1 percent of additional sugar recovery has been raised to Rs 3.32 per quintal for 2024-25 from Rs 3.07 per quintal in the current season. A similar amount will be deducted if the recovery is 0.1 percent lower.

"However, Rs 315.10/quintal is the minimum price of sugarcane which is at recovery of 9.5 percent. Even if sugar recovery is lesser, farmers are assured of FRP @ Rs 315.10/quintal," the government said.