UP’s sugar production touches 110 lakh tonne, cane dues mount to Rs 12,000 crore

As sugar mills in Uttar Pradesh start inching towards closure, the state’s 120 sugar mills have so far produced 110 lakh tonne, which is approximatey 12% less than last year’s production of 126 lakh tonne.

Of the 120 sugar mills in operation, 110 have shut shop while the remaining 10 are likely to close by the end of the month or in early June. According to industry sources, the season in UP may well end with total output of a little over 110.5 lakh tonne.

According to data accessed by FE, as on May 24, the 120 mills that operated in this season have paid Rs 20,324 crore cane dues to the farmers, while Rs 11,913 crore are still pending. The 93 private sugar mills operating in the state have cleared 65% of their dues and still owe approximately Rs 10,087 cr, while 24 UP Cooperative sugar mills have paid 38.48% and owe Rs 1629 cr.

The three UP sugar corporation mills have paid 49% of their dues and still owe Rs 197 crore.

The payment of Rs 20,324 crore is slightly more than 63% of the total cane dues during the season, when mills crushed 1018.82 lakh tonne of sugarcane to produce 109.81 lakh tonne of sugar.

It may be mentioned that UP has been historically closing sugar seasons with high cane dues. While last year’s (2019-20) cane dues at the end of the season stood at a historical high of Rs 14,800 crore, in 2018-19, the closing dues were at Rs 10,213.88 crore, while in 2017-18, the closing dues were to the tune of Rs 12,419.63 crore.

While the state’s average payment is around 63%, some private sugar mills’ performance is abysmally poor. The major defaulters are the Yadu group’s two mills that have made only 3.06% of its total cane dues, while the Modi group’s two mills have paid only 3.93% of its total cane dues. The Bajaj group too, which has 14 sugar mills in the state, has paid a meagre 15.8% of its total dues, while Simbhaoli group’s three sugar mills have paid a mere 24.12%.

However, groups such Dwarikesh, DSC, Dalmia, Birla, Dhampur, Triveni, IPL and Balrampur Chini have paid well. While Dalmia’s three mills have paid 94.66%, Dwarikesh group, which has three sugar mills, has paid 93.66% of its dues. Balrampur group’s 10 sugar mills have paid 93.48%, while DSCL’s four mills have paid 92.70%. Dhampur’s five mills that have paid 86.83%, followed by Birla group’s four mills have that have paid 80.44%. Triveni’s seven mills have cleared 87.68% of their dues, while Indian Potash’s six mills have paid 71.84%.