Sugarcane farmers in India, the world’s second biggest producer of the sweetener, may earn more in the 2011-12 crop year as the Centre plans to raise the Fair and Remunerative Price (FRP) of cane by Rs. 4 a quintal to Rs. 143.
The Centre had fixed the FRP at Rs.139 per quintal in the 2010-11 sugar year, which runs from October to September. FRP is the floor price of cane fixed by the Union government. It is computed by the Commission for Agricultural Costs and Prices by factoring in the imputed value of family, labor, rent, element of risk and profit for the farmer. The commission also takes into account the cost estimates by sugar producing states before deriving a weighted annual all-India average. In 2010-11, the cane FRP saw a mark up in price by 15% for profit and by 20% for risk involved.
The food ministry is also considering a proposal to slash the import duty on the sweetener from the current 60% to 20-30% by March as domestic supply is projected to exceed demand for the first time in three years.
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