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Punjab farmers unhappy over cane prices




  • THE government has finally given in to the pressure of the powerful lobby of sugar millers, who are heavily represented in the Parliament as well as in the federal cabinet and conceded most of the demands, the industry had put forward as a pre-condition for starting cane crushing.

    While accepting the industry’s demands, the government has itself violated the Cane Act by allowing the millers to delay the start of crushing by two weeks, and by making certain decisions that would ultimately prove detrimental to the interests of sugar cane farmers in Punjab, if not in the other two provinces – Sindh and the NWFP.

    Ministry of Food, Agriculture & Livestock (MINFAL) secretary Ismael Qureishi claims that the decisions had been taken with a view to protect the interests of sugar cane growers and consumers and to address the legitimate concerns of the industry.

    The growers in Punjab are not ready to buy his argument, saying the decisions will favour the millers at the expense of the farmers of the province that produces about 70 per cent of the total sugar cane crop.

    They insist that two decisions , which let the mills to delay crushing by at least two weeks and fix the support price of sugar cane at Rs60 per maund (or 40kg) in Punjab as compared to Rs67 in Sindh and Rs65 in the NWFP, will allow the millers to make windfall profits without doing anything, at the expense of the poor growers.

    The support price of sugar cane is linked with the percentage of sucrose recovery. Since average sucrose recovery of around 9.10 per cent in Sindh is highest, its growers always get a premium for their crop. With the average content recovery standing at 8-8.5 per cent in Punjab, and 7.3 per cent in the NWFP, farmers from these two provinces get a lower rate for their crop.

    Historically, the sugar cane growers from Punjab and the NWFP get the same support price or the minimum indicative rate for their crops, in spite of the differential of 0.7-1.2 per cent in the percentage of content recovery. This time round, however, farmers of the NWFP are set to get a far better price for their crop despite lower content recovery than their counterparts in Punjab.

    “If the support price is linked with the content recovery, Punjabi growers should have gotten a better deal than farmers of the NWFP,” says AgriForum chairman Ibrahim Mughal.

    “Since this has not been done, we are forced to suspect that somebody, somewhere in the power corridors has managed to manipulate the government decisions for the benefit of the mill owners and deprived the growers from Punjab of a fair rate for their produce.

    It is an open secret that the sugar millers have a strong representation in the government, and enjoy a status that lets them influence the government policies and decisions. And they have finally prevailed,” he insists.

    About 70 per cent – or 35 million tons – of total national sugar cane crop of around 50 million tons is produced by Punjab on 1.775 million acres of land. The rest of the crop is produced by Sindh (about one million ton from 500,000 acres) and the NWFP (about half a million tons from 265,000 acres).

    Some 80 per cent of the crop is consumed by the sugar mills for making the sweetener and the rest of 20 per cent is used as seed for the next crop as well as for making gur or is used as fodder.

    “If we go by the statistics, and if we consider that the content recovery rate in Punjab and the NWFP is same, the Punjabi farmers stand to lose close to Rs3.50 billion just because they will be getting Rs5 per maund less than the growers from the NWFP. Who stands to gain from this? Obviously, the 40 powerful sugar mill owners from Punjab will divide this amount between themselves without doing anything. The amount that should have come to farmers of Punjab will now be going to the millers.

    And if we link the crop’s support price with the content recovery, we should have received a higher price for our crop than farmers of the NWFP. That simply means that growers from the province are being doubly squeezed by the millers,” Mughal points out.

    Moreover, he says, the growers from Rahim Yar Khan, the district bordering Sindh, are given an even worse deal. The sucrose content recovery in the sugar cane crop from Rahim Yar Khan is almost the same as in Sindh because of similar climatic conditions.

    However, they shall get paid the price equal to those growers from the areas where the recovery rate is lower. “That will be an additional benefit for the mills in the district of Rahim Yar Khan,” he says. “So much for the government claims that it has protected the interests of farmers.”

    Mughal fears that the lower support price will impact upon the farmers’ decision to grow sugar cane next year. “I seriously fear that the cane crop next year is going to be far less than this year if the growers do not get a fair price for their produce based on the sucrose recovery rate,” he says.

    The government has just indicated the period, without fixing any specific dates, during which it expects the mills to begin their operations. There is no guarantee that the mills will not stretch the ‘grace’ period allowed to them by the government to three weeks or more, from two weeks.

    He says the sugar millers in Punjab will not only make money by paying less to the farmers but also from delayed commencement of crushing. “The mills always tend to delay crushing because sucrose content recovery increases by 0.5 per cent every month. They wanted to delay crushing not because they have unsold stocks, but because they want higher sucrose recovery and that too without paying an additional amount to the farmers.”

    The delay in cane crushing by the mills is feared to delay sowing of wheat on 200,000 acres of land in Punjab, causing a loss of Rs500 million to farmers in the form of lower yields.

    “The dates for starting cane crushing in Punjab, Sindh and the NWFP given in the Cane Act were determined with a view to give sufficient time to farmers for timely sowing of wheat. The delay in the commencement of sugar harvest means that wheat sowing, and as a consequence of this its yield, is going to suffer,” he says.

    Will somebody stand up and take the responsibility for goofing up everything for the farmers from Punjab? Certainly, no one!

    Courtesy: The DAWN

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