Cane arrears for 2014-15 sugar season down to Rs 2,700 crore from peak of Rs 21,000 crore

NEW DELHI: Cane price arrears for 2014-15 sugar season have come down to Rs 2,700 crore as on January 12 from Rs 21,000 crore, the food ministry said.

In a press statement on January 14, the ministry said that several measures taken by the Centre improved liquidity of sugar mills and enabled them to clear cane price dues of farmers.

The government “provided incentive on raw sugar export, extended financial assistance in the form of soft loan, fixed remunerative price for and waived off excise duty on ethanol supplied under ethanol blending programme and more recently a production subsidy to sugar mills to offset cost of cane and facilitate timely payment of cane price dues”, the ministry said.

Sustained surplus of production over domestic consumption in the past five years led to subdued sugar prices, leading to build-up of cane price arrears. During sugar season 2014-15, the peak cane price arrears were Rs 21,000 crore as on April 15, 2015.

The sugar industry is now actively participating in the ethanol blending programme, having supplied 6.82 crore litres of ethanol to oil marketing companies during the current sugar season (since October 2015) compared to 1.92 crore litres supplied a year ago, the ministry said.

Moreover, the contracted quantity under the programme has reached a record 120 crore litres in the current season, it said.