AISTA seeks 35% hike in minimum selling price of sugar to Rs 42/kg , backs government cane FRP

New Delhi: Sugar trade body AISTA has asked the government to raise the minimum selling price of sugar to Rs 42 per kg from Rs 31, while backing the government's cane price as "fair and just", as a panel probes unrest among sugarcane farmers.

The All India Sugar Trade Association (AISTA) made the demands in a presentation to a four-member committee headed by former Niti Aayog member Ramesh Chand, set up on October 13 to address grievances of protesting growers, mainly in Karnataka and Maharashtra.

The panel met sugarcane growers in Bengaluru and later in Pune on November 4. An AISTA delegation attended the meeting in Pune.


AISTA Chairman Praful Vithalani said the minimum selling price of sugar had remained unchanged since February 2019 and should be raised to at least Rs 4,200 per quintal to ensure that mills do not sell sugar below their cost of production.

Read more: India's sugar exports reach 2.01 lakh tonnes till February in 2026 MY: AISTA

The government fixed the fair and remunerative price (FRP) for cane for the 2026-27 season (October-September) at Rs 365 per quintal on May 5, linked to a basic sugar recovery rate of 10.25 per cent. Vithalani said stakeholders had widely accepted the price at the time.

"We see no reason for agitating on the same issue at this point of time," he said in a statement.

AISTA also said Indian sugarcane prices are among the highest in the world.

The association urged the panel to study a payment system used in Gujarat. Under its proposed two-tier model, farmers could choose to be paid the full FRP within 7 to 14 days of delivery, or receive the FRP plus a 10 per cent premium if they accept payment in three installments.

Read more: AISTA trims India sugar output estimate to 28.3 mt on weather hit

ETHANOL LOANS

The industry also sought relief on loans taken to build ethanol distilleries as part of the government's programme to blend 20 per cent ethanol with petrol.

AISTA said poor weather is expected to limit surplus sucrose availability in the current and next sugar seasons, curtailing ethanol output and leaving mills unable to service debt.

It asked for a two-year moratorium on principal and interest payments for affected sugar-based ethanol projects, and for the government to raise its interest subvention to 100 per cent from 50 per cent during that period, to prevent the loans from turning into bad debt.