Bengaluru: Karnataka state government has proposed eight measures, including four immediate interventions for the current sugarcane crushing season and four long-term structural reforms to address the concerns of sugarca…

Bengaluru: Karnataka state government has proposed eight measures, including four immediate interventions for the current sugarcane crushing season and four long-term structural reforms to address the concerns of sugarcane farmers and factories.In a detailed representation submitted to Dr Ramesh Chand, head of the committee constituted by the Centre to examine issues concerning farmers and the sugar industry, the state government on Friday urged the Union government to revise the minimum selling price (MSP) of sugar to Rs 41.50 – Rs 44.33 per kg. MSP has remained unchanged at Rs 31 per kg since February 2019.Commerce and Industries Department Secretary Rohini Sindhuri, who presented the proposal to the committee, highlighted the financial difficulties faced by sugar factories and farmers amid drought, falling cane yields and uncertainty over ethanol production.Only 19 of 55 Maharashtra sugar mills begin crushing amid farmer protests; Karnataka yet to startThe proposal requested the central government to restore the base sugar recovery rate for fixing the Fair and Remunerative Price (FRP) of sugarcane to 9.5 per cent from the current 10.25 per cent as farmers were impacted by climatic conditions. The State also requested the Centre to reconsider restrictions on the diversion of sugarcane for ethanol production.The State government said that while the FRP of sugarcane has increased by nearly 33 per cent, from Rs 2,750 per tonne in 2019-20 to Rs 3,650 per tonne in 2026-27, the MSP of sugar has remained stagnant. It sought a cost-based MSP revision, with a review every six months, to ensure that factories can meet their cane payment obligations.Karnataka government also requested the Union government to reconsider the Department of Food and Public Distribution’s October 22, 2026 directive that prohibits the diversion of sugar to ethanol during the 2026-27 Ethanol Supply Year, beginning November 1. The restriction prevents mills from producing ethanol using sugarcane juice, syrup and B-heavy molasses.“The decision would leave significant investments in distilleries underutilised and affect the financial stability of sugar factories. The State has 60 distilleries, including 54 based on sugar and molasses, with a combined annual capacity of about 225 crore litres,” stated the representation and added that Centre can review the restriction after the crop estimate in February 2027.Sugarcane farmers in Karnataka are threatening to lock up sugar mills. But what’s behind the protest?Karnataka has also sought an increase in administered ethanol prices to Rs 73 per litre for sugarcane juice and syrup, Rs 67 for B-heavy molasses and Rs 61 for C-heavy molasses, arguing that the prices of byproducts haven’t changed despite the rise in cane procurement costs.State-specific FRPThe proposal also asks the Union government to announce State-specific FRPs based on cultivation costs, adopting the C2+50% formula recommended by the Swaminathan Commission. It has also sought separate sugar prices for household and commercial consumption.On the long-term reforms, the State has asked for a revision of the Rangarajan Committee’s revenue-sharing formula to include income from ethanol and cogeneration, besides sugar and other by-products. It has also sought the establishment of a national Price Stabilisation Fund to protect farmers when market realisations fall below the statutory FRP.’No farmer should suffer’: Karnataka CM DK Shivakumar asks officials to brace for droughtKarnataka has around seven lakh hectares under sugarcane cultivation, with an estimated 18–20 lakh farmers dependent on the crop. The State has 81 working sugar factories with a combined crushing capacity of about 5.94 lakh tonnes of sugarcane a day.

Source: Deccan Herald