Government revises Fair and Remunerative Price (FRP) for sugarcane up 51% at Rs. 129.84 per quintal

Government revises Fair and Remunerative Price (FRP) for sugarcane up 51% at Rs. 129.84 per quintal

The Government has decided to fix Fair and Remunerative Price (FRP) for sugarcane at Rs. 129.84 per quintal to be paid by the sugar factories with effect from 1st October, 2009, instead of the Statutory Minimum Price (SMP) fixed earlier. It is linked to a basic recovery rate of 9.5% subject to a premium of Rs.1.37 for every 0.1 percentage point increase in recovery above 9.5%.

The sugarcane farmer is legally guaranteed a price of Rs.129.84 per quintal. However, the sugar mills are free to offer any price above the FRP as deemed fit by them. The FRP for 2009-10 will be over 51% higher than the SMP for the year 2008-09.

Since the FRP gives adequate consideration for margins on account of profit and risk to the farmers, Clause 5A of the Sugarcane (Control) Order, 1966 (SCO) which provided for sharing of additional profits by sugar mills, has been deleted.

It has also been provided in the SCO that if any State Government or any other Authority fixes any price for sugarcane above the FRP, the difference between such price fixed by the State Government or the Authority above the FRP fixed by the centre will be paid by the State Government or such Authority to the farmers or the sugarcane growers co-operatives, as the case may be.

Courtesy: Ministry of Consumer Affairs, Food & Public Distribution