Under the Sugarcane (Control) Order, 1966, sugar factories are required to pay FRP within 14 days of cane delivery
Kolhapur : The state sugar commissionerate has initiated recovery proceedings against 15 sugar mills after a Sept 15 report showed that 30 mills owed farmers Rs 194 crore in fair and remunerative price (FRP) payments for the 2025-26 season. Under the Sugarcane (Control) Order, 1966, sugar factories are required to pay FRP within 14 days of cane delivery. At the end of the crushing season in April, pending FRP dues stood at Rs 1,303 crore. The outstanding amount has since come down to Rs 194 crore, though 30 sugar mills continue to have pending payments. State govt has, meanwhile, approved payment of about Rs 738 crore towards interest on soft loans that sugar factories will avail to clear pending FRP dues and raise working capital for harvesting and transportation expenses ahead of the next crushing season, scheduled to begin from Oct 15. A total of 210 sugar mills, evenly split between cooperative and private sectors, were granted crushing licences last season. Together, they crushed 1,045 lakh tonnes of sugar cane. The total FRP liability was around Rs 30,278 crore, excluding harvesting and transportation charges. Despite the liability, mills collectively paid Rs 31,562 crore, exceeding the payable amount as several factories offered cane prices higher than FRP following an improvement in sugar prices in Aug. 30 factories still have payment shortfalls ranging from marginal amounts to nearly 100% of the dues While around 180 mills cleared 100% of their FRP obligations.
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FRP payment is mandatory under law and mills failing to clear dues will not get licences for the next crushing cycle,” a senior official said. Besides issuing revenue recovery certificates (RRCs) to the mills, the commissionerate has warned defaulting units that they would not receive crushing licences for the upcoming season unless the dues were cleared. If they fail to do so, the sugar commissioner can issue an RRC, empowering district authorities to recover dues by attaching sugar stocks, seizing assets or auctioning sugar from factory godowns. “These sugar factories are from Marathwada and Solapur districts. The authorities are assessing their financial position and repayment capacity. Download the TOI App.