FRP stands for Fair and Remunerative Price, which is the minimum price to be paid
by the sugar mills to the cane suppliers/growers who have given their cane for crushing
to the mill. Prior to 2009 the Central Government had been fixing the Statutory
Minimum Price (SMP) of sugarcane, for every sugar season, as provided in Clause
3 of the Sugarcane Control Order, 1966. The following factors are taken into consideration
while calculating the SMP-
- Cost of production of sugarcane
- Returns to the growers from alternative crops and the general
trend of prices of agricultural commodities
- Availability of sugar to consumers at fair price
- Price at which sugarcane produced from sugarcane is sold by
sugar producers
- Recovery of sugar from sugarcane
- The realization made from sale of by-products viz. molasses,
bagasse and press mud or their imputed value
On 22nd October, 2009 the Sugarcane Control Order was amended, by inserting clause
(g) which provides for giving reasonable margins to the growers of sugarcane on
account of risks and profits. Powers were accordingly given to the Central Government
to fix a Fair and Remunerative Price (FRP) from 2009-2010 sugar seasons, effective
from 1.10.2009.
The SMP/FRP is fixed on the basis of the recommendations of the Commission for Agricultural
Costs and Prices (CACP) in consultation the various State Governments and associations
of sugar industry and the cane growers.
For the season 2011-2012, the Central Government has fixed the FRP of sugarcane
at Rs 145 per quintal of cane, linked to a basic recovery rate of 9.5%, along with
a premium of Rs 1.50 for every 0.1% point increase in the recovery. SMP/FRP of sugarcane
payable by sugar factories for sugar season since 2001-2002 is as given below,
|
Sugar Season
|
SMP/FRP per quintal
|
Recovery Rate %
|
|
2001-02
|
62.05(SMP)
|
8.5
|
|
2002-03
|
69.50(SMP)
|
8.5
|
|
2003-04
|
73.00(SMP)
|
8.5
|
|
2004-05
|
74.50(SMP)
|
8.5
|
|
2005-06
|
79.50(SMP)
|
9
|
|
2006-07
|
80.25(SMP)
|
9
|
|
2007-08
|
81.18(SMP)
|
9
|
|
2008-09
|
81.18(SMP)
|
9.5
|
|
2009-10
|
107.76(SMP)
|
9.5
|
|
2009-10
|
129.84(FRP)
|
9.5
|
|
2010-11
|
139.12(FRP)
|
9.5
|
|
2011-12
|
145.00(FRP)
|
9.5
|
|
2012-13
|
190.00(FRP)
|
9.5
|
After delicensing of sugar industry, the Govt. decided that in order to avoid un
healthy competition among sugar factories to procure sugarcane, a minimum distance
of 15 km would continue to be observed between an existing and new sugar factories
by exercise of powers under the Sugar Cane Control Order dated 10th November, 2006
and this order was made applicable from the date of its publication in the official
gazetee ie w.e.f. 10th November, 2006.
Clause 6A puts restriction on setting up of two sugar factories within the radius
of 15 kms. It provides that no new sugar factory shall be set up within the radius
of 15 kms. of any existing sugar factory or another new sugar factory in a state
or two or more states. However, the State Government have been authorized to notify
minimum distance higher than 15 kms with the prior approval of the Central Government.
As per explanation 3 of Clause 6A minimum distance shall be determined as measured
by Survey of India.
Clause 6B prescribes the requirements for filing the Industrial Entrepreneur Memoranda
(IEM). It provides that before filing the IEM with the Central Government, the concerned
person shall obtain a certificate from the Cane Commissioner or Director (Sugar)
of Specified Authority of the concerned State Government and after filing the IEM,
the concerned person shall submit a performance guarantee of rupees One crore to
Chief Director (Sugar), within thirty days of filing the IEM as a surety for implementation
of the Industrial Entrepreneur Memorandum within the stipulated time or extended
time as specified in Clause 6C failing which IEM shall stand de-recognized as far
as provisions of this Order are concerned.
State Government, vide a publication of gazette on 03.12.2012, with prior approval
of Central Government, has notified the minimum aerial distance 25 km. between two
sugar factories.
|
Title
|
File
|
|
Sugar Industry in Maharashtra at a Glance
|
|
The Sugar industry in Maharashtra has been a major contributor to the Chief Minister’s
Assistance Fund. The following table shows the year-wise contribution made to the
fund by Sugar factories in the state.
|
CHIEF MINISTER'S ASSISTANCE FUND
|
|
Sr. No.
|
Crushing Season
|
Deposited Fund
(In Cr. Rs.)
|
|
1
|
2005-06
|
12.55
|
|
2
|
2006-07
|
4.12
|
|
3
|
2007-08
|
6.96
|
|
4
|
2008-09
|
13.37
|
|
5
|
2009-10
|
15.04
|
|
6
|
2010-11
|
15.43
|
|
|
Total
|
67.47
|