February 16, 2011 Leave a comment
Mills raise cane rates to ensure supplies
THE supply of sugarcane to mills in Khyber Pakhtunkhwa has picked up following fall in gur prices and improved rates being offered by sugar mills.
Gur prices plunged to Rs5,000-5,500 per 80 kg in local markets from Rs6,000-6,500 last month and Rs7,500-8,500 last October. This has prompted farmers to take their crop to millers who are offering better prices these days.
The price offered by mills is Rs338 per 50 kg of cane. But farmers Farmani Gul Khan argue that on the basis of recent gur prices this season, it should be around Rs450 for 50kg.
Since 2007, gur has been costlier than sugar.But it has lost its place of being the first priority of farmers in the province. For example with a crop of 300 maunds, a farmer will earn around Rs83,000 if he opts for gur, and over Rs100,000 if he takes it to mills, says mill owners.
Cane manager at the Premier sugar mills in Mardan Masood Khan says increase price offer has augmented supplies to the mills. “The cane supply situation improved in February and we are crushing around 3,000 tons of cane daily, approaching fast to our peak crushing of 4,000 tons achieved some years ago. We are running the mills non-stop. Gur is our main competitor. If its prices come down, farmers will come to us and vice versa. But for the moment, we are satisfied. Cane supply to mills in Dera Ismail Khan and Charsadda has also improved a lot,” he said.
Why do growers often prefer gur making? “The gur agents make advance agreements to farmers, and payments are made for standing crops. They provide seasonal/crop-based loans to growers which are used for buying inputs and meeting their domestic needs. How could farmers sell their cane crop to mills in this situation?” asks Jehangir Khan, a farmer.
“The millers, conversely, wait for farmers to bring their crop to the mills which they have already pledged to gur agents against return of advance payments or easy loans. Cane crop is also bought by cane-juice-sellers on advance payments. The millers should make agreements with cane farmers as is done in case of tobacco crop. They should purchase cane crop at fixed and better rates. Why can’t they make advance payments or provide loans to farmers like their competitors at the start of the season?” he asks.
Jehangir said farmers at present had to go to mills to get indents for their cane and suggested that it should be the other way round. “They need to reach farmers like their gur competitors. The millers in the past had opened local cane purchase/dumping centres. The farmers would bring their produce to these centres and the millers would pick it from there. This needs to be revived,” he suggests.
“Besides a fixed price for certain fixed sugar-content, farmers should get enhanced payment for produce with better sugar-content. This will be an incentive for them,” he maintains.
“In Punjab a large quantity of gur, named duplicate is being produced by mixing gur with glucose and other ingredients. It has not only a good look but also tastes better and is cheaper.
Around 100kg of duplicate is prepared in an hour. Farmers in Khyber Pakhtunkhwa are also planning to start producing this variety.
This means that more and more cane will be used for making gur in future. Millers will have to be more responsive and competitive to avoid this scenario,” Yousaf Shah, another farmer, adds.
“Farmers opt for gur making for two other reasons as well. One: they have to feed their livestock with cane-grass which necessitates intermittent cutting of crop as allowed by gur manufacturers and not simultaneous harvesting of the entire crop as needed by mills. Two: they use gur in their homes which they make even if they take bulk of their crop to mills. This can be avoided by providing fodder seeds and supplying farmers with sugar on deferred payment,” says Shah.
Khyber Pakhtunkhwa produces about 1.3 million tons of sugarcane. It can produce up to 0.1 million tons of sugar if cane supply to mills is improved.
But the problem is that the area under cane cannot be increased because of its competition with wheat or maize and water shortage. “Investment in research for high-yielding cane varieties and increasing per acre yield with better sugar content is the need of the hour. Millers should also help, ” Jehangir argues.