Sugarcane prices in Uttar Pradesh have surged to as high as Rs 425 per quintal, triggering what industry insiders describe as a cane price war and intensifying competition between sugar mills, jaggery crushers (kolhus), and khandsari units.
Jaggery and khandsari units in several parts of the state are now offering farmers between Rs 400 to 425 per quintal for sugarcane. This has put sugar mills under pressure, as they struggle to secure adequate cane supplies during the ongoing crushing season. In this scenario, sugar mills may face a shortage of cane and be forced to keep the crushing season shorter.
Sugar mills in Uttar Pradesh and neighbouring Uttarakhand, India’s largest sugarcane-producing region, are facing supply constraints. While the standing crop appears good, farmers and industry experts say cane productivity is about 10 percent lower than last year. As a result, cane prices have risen sharply in recent days, crossing the State Advised Price (SAP) fixed by the Uttar Pradesh government for the 2025–26 crushing season.
Krishna Pal Singh, founder of the modern jaggery unit ‘Hans Heritage Jaggery’ in Shamli district, told Rural Voice that cane availability has been a challenge this season. His unit has raised the cane purchase price from Rs 380 to Rs 400 per quintal. “The crop looks good in the fields, but sugar content has not developed as expected. Both cane weight and recovery, whether for sugar or jaggery, are lower,” he said. To secure supplies, kolhu and khandsari units are being forced to offer better rates. Due to cane shortages, his unit is operating only for about 12 hours a day. Although jaggery prices have fallen from Rs 38 per kg to Rs 34 per kg, a recovery rate of around 14 percent is still allowing better cane prices to farmers.
A senior official at a sugar mill in Meerut said that despite higher cane prices, ensuring adequate supplies remains difficult. “This is why there is intense competition among sugar mills to maximise crushing,” the official said, attributing the situation to lower yields caused by disease and weather, as well as stiff competition from kolhu and khandsari units. He added that mills are paying farmers within a week of cane delivery.
Industry experts point out that the SAP for sugarcane has not been raised for the past two years, while harvesting costs have climbed to Rs 55–60 per quintal. This has led to a decline in cane acreage. Disenchantment with sugarcane cultivation has also pushed many farmers in western Uttar Pradesh districts such as Saharanpur, Muzaffarnagar, and Shamli towards agroforestry, posing an additional challenge for sugar mills.
Across the border in Uttarakhand’s Haridwar district, Libberhedi is known as a hub of the jaggery industry. Local farmer Rahul Lohan said kolhus are paying between Rs 430 and Rs 450 per quintal for cane. “Immediate payment is another reason why many farmers prefer supplying to kolhus. Sugar mills are finding it hard to procure cane,” he said. Earlier, farmers had to wait for cane slips from mills, but this season there is no such shortage.
Rishipal Singh, a farmer from the Bahadrabad–Jatt area of Haridwar district, said labour shortages and stagnant cane prices in recent years have pushed farmers towards agroforestry crops such as poplar and eucalyptus. “This will further worsen the cane shortage for sugar mills,” he said, adding that rates of Rs 400–425 per quintal at kolhus have become common. “Earlier, long queues of tractor-trolleys were seen outside sugar mills. Now those queues are visible at kolhus instead.”
This year, the Uttar Pradesh government raised the SAP for sugarcane by Rs 30 to Rs 400 per quintal, while Uttarakhand fixed its SAP at Rs 405 per quintal. However, stagnant prices over the past two years and the spread of diseases such as red rot have led to a decline in cane production in both states.
As a result, sugar mills in Uttar Pradesh and Uttarakhand were forced to conclude the crushing season early last year. Given the current situation, industry insiders warn that the scenario could be even more challenging this season.