State Advisory prices for Sugarcane

Context: SAP for sugarcane did not change in UP for third year in a row.

Concept:

With the amendment of the Sugarcane (Control) Order, 1966 on 22.10.2009, the concept of Statutory Minimum Price (SMP) of sugarcane was replaced with the ‘Fair and Remunerative Price (FRP)’ of sugarcane for 2009-10 and subsequent sugar seasons.
FRP is announced by the Central Government and is decided on the basis of the recommendations of the Commission for Agricultural Costs and Prices (CACP) in consultation with the State Governments and after taking feedback from associations of sugar industry.
Under the FRP system, the farmers are not required to wait till the end of the season or for any announcement of the profits by sugar mills or the Government.
The new system also assures margins on account of profit and risk to farmers, irrespective of the fact whether sugar mills generate profit or not and is not dependent on the performance of any individual sugar mill.
States declare state specific sugarcane prices called StateAdvised Prices (SAP), usually higher than the SMP/FRP.
Since early 1970s, State Advised Price (SAP) came into existence in States like UP, TamilNadu, Punjab, Haryana etc.