Curious tale of sugarcane price payments by UP sugar mills; Malakpur mill makes zero payment but Parsendi 99.5 per cent

If you would like to know how the sugar mills are proving to be hero and villain for the sugarcane farmers, you need to take a look at the details of the payments made to the farmers till May 12, 2021, for the current crushing season 2020-21. These present a startling picture. This has been analyzed in this third story of the RuralVoice series on cane price payments.

The Modi group sugar mill at Malakpur in Baghpat district of UP is one that has, as per official record, made zero payment to the cane farmers for the current season. On the other hand, the sugar mill located at Parsendi in Bahraich district has made 99.95 per cent. In fact, according to these data, there are several such private sugar mills or sugar mill groups as have made 90 per cent or more of the payments. But there are others that have made only 1.5 to 20 per cent of the payments till May 12. The average for the payments for the entire state till the said date is 62.29 per cent.

One gets to understand from these data that while the payments situation is better for some farmers of the state, there are others for whom it is proving to be a cause of economic crisis; that the situation is not the same for all sugar mills of the state with regard to arrears of Rs 11,872.70 crores in cane price payments. As far as the arrears are concerned, even the Sugar Corporation mills and cooperative mills of the state fall in the category of those who have made less payments.

Let us first talk of those sugar mills and groups which stand at the bottom in cane price payments. The Yadu group has two sugar mills in the state and it has made only 1.5 per cent of the payments — the least — till May 12. It has to pay the farmers a total of Rs 114.41 crores. As per the data on May 12, out of this, it had made payments of only Rs 1.72 crores. Thus, it is Rs 112.69 crores in arrears. The Umesh Modi group has two sugar mills and it has made only 1.75 per cent of the payments. The group is Rs 617.06 crores in arrears. Its Malakpur mill has made no payment for the current season and its account reflects zero in its record. This mill owes Rs 378.76 crores to the farmers. The other Modi sugar mill is in Modinagar. It has made 4.41 per cent of the payments so far.

Among the large groups, the Bajaj group, which has a maximum of 14 sugar mills in the state, has made only 12.59 per cent of the payments so far. It had to pay the farmers a total of Rs 4,385.09 crores to the cane farmers. Out of this, it has only made payments of Rs 549.96 crores and is Rs 3,835.12 crores in arrears. The three sugar mills of the Simbhaoli group owe Rs 607.49 crores to the farmers. The group has made only 21.24 per cent of the payments till May 12.

Let us now come to the sugar mills and sugar mill groups which are proving to be better for the cane farmers. RS Newatia’s sugar mill located at Parsendi in Bahraich had made the maximum payments in the state. As of May 12, this sugar mill has made 99.95 per cent of the payments to the farmers and was left with only Rs 10.47 lakhs in arrears. Interestingly, the Malakpur sugar mill, which has made no payment to the farmers for this season, is also in this very state of UP.      

Even among the large sugar mill groups, there are several in a better payment situation. The Balrampur group, which has 10 sugar mills, had made 93.38 per cent of the payments till May 12. The Dalmia group, which has three sugar mills, has made 94.86 per cent of the payments. DSCL has four sugar mills and it has made 92.22 per cent of the payments till May 12. The Dwarikesh group, which has three sugar mills, has made 92.88 per cent of the payments while the Triveni group, which has seven sugar mills, has made 89.43 per cent of the payments. The Dhampur group, which has five sugar mills, has made 88.2 per cent of the payments.

What is startling, however, is that the three sugar mills of Shamli, the home district of Suresh Rana, the Sugarcane Development and Sugar Industry Minister in the state, have made only 23.24 per cent of the payments. The Shamli-based Sir Shadilal sugar mill has made only 17 per cent of the payments. As of May 12, these three mills of the district owe Rs 843.55 crores to the cane farmers.

Besides, another fact that has come to the fore is that the payments average of the private sector is better than that of the state government-controlled cooperative mills and State Sugar Corporation mills. As of May 12, the sugar mills owned by the State Sugar Corporation have made only 45.92 per cent of the payments while the payments made by the cooperative sugar mills, also run by the state management, stand at a mere 37.71 per cent. In contrast, the payments of private sugar mills stand at 64.75 per cent. This makes it apparent that even the state government itself is not serious about payments to the cane farmers.