TN Sugar Mills Looking For Help From State Govt

Chennai: Sugar mills in Tamil Nadu are pushing for help from the State Government on sugarcane price and sugar exports. According to the South Indian Sugar Mills Association representatives, the mills here are at a disadvantage as compared to their counterparts in other States, where the Governments have declared support (or at least expressed intention to support) sugar exports or sugarcane payments to farmers. The sugar mills here pay the highest in purchase tax on sugarcane (Rs 60 a tonne); movement of molasses is controlled leading to an artificial glut and crash in prices. Andhra Pradesh has declared a late crushing subsidy of Rs 100 a tonne of sugarcane to mills to compensate for the sugar recovery loss when they crush sugarcane late into the summer.
Karnataka too has declared a similar support apart from abolishing purchase tax on sugarcane. Industry representatives said that Maharashtra has declared a transport subsidy on sugarcane of Rs 2 per km per tonne for moving cane beyond 15 km, a late crushing subsidy and an export subsidy of Rs 1,000 a tonne of sugar. The State Government should come out with a declaration on sugarcane pricing support along the lines of that announced by the others. Purchase tax in Tamil Nadu is the highest in the industry. The State Government has also not facilitated unveil of the ethanol-blended petrol programme, which would mean additional revenue for the mills. At 5 per cent blending the oil companies would need about 5.8 crore litres ethanol a year for which the price has been fixed at Rs 21.50 a litre. Since the State Government does not allow export or movement of molasses out of Tamil Nadu, the glut has resulted in prices hitting the bottom.