23 February 2024, New Delhi: Indian sugar stocks witnessed high selling pressure on Thursday morning after the government announced an increase in the fair and remunerative price (FRP) of sugarcane to Rs 340 per quintal from Rs 315 for the 2024-25 season.
At 10.20 am, Balrampur Chini Mills was down 1.18 per cent down at Rs 376.5, Dalmia Bharat Sugar was down 1.24 per cent at Rs 402.9, Shree Renuka Sugars down 2 per cent at Rs 48, and EID-Parry India down 2.3 per cent at Rs 624.95.
Other sugar stocks including, Avadh Sugar, Mawana Sugars, Rajshree Sugars, and Bannari Amman also fell up to 3 per cent on the NSE.
On Wednesday, the Cabinet Committee on Economic Affairs chaired by Prime Minister Narendra Modi approved the Fair and Remunerative Price (FRP) of sugarcane for the Sugar Season 2024-25 at Rs 340 per quintal at a sugar recovery rate of 10.25 per cent. The revised FRP will be applicable from 1 October 2024.
According to the government, a premium of Rs 3.32 per quintal will be provided for every 0.1 percentage points increase above 10.25 per cent in the recovery. It will benefit more than 5 crore sugarcane farmers and their families.
“With this approval, sugar mills will pay FRP of sugarcane @ Rs 340/quintal at the recovery of 10.25 per cent. With each increase of recovery by 0.1 per cent, farmers will get the additional price of Rs 3.32 while the same amount will be deducted on a reduction of recovery by 0.1 per cent. However, Rs 315.10/quintal is the minimum price of sugarcane which is at recovery of 9.5 per cent. Even if sugar recovery is lesser, farmers are assured of FRP at Rs 315.10/quintal.”, the official statement said.
This is the historic price of sugarcane, which is around 8 per cent higher than the FRP of sugarcane for the current season 2023-24, according to the statement.
The fair and remunerative price is the minimum price that sugar mills pay farmers. The sugarcane growers are offered FRP by the government under the Sugarcane (Control) Order of 1966. The Commission of Agriculture Costs and Prices (CACP) annually formulates recommendations for FRP, encompassing various agricultural commodities, including sugarcane. The recommendations are evaluated by the government before they are approved.
