Sugar mills demand hike in MSP

Sugar mills demand hike in MSP

Subject: Economy

Context: Sugar mills are demanding a hike in the minimum selling price to enable them to clear the dues to the farmers which have touched a whopping Rs 23,000 crore. Rising output have caused ex-mill prices to fall to Rs 31-33 per kg, almost to the levels of the minimum selling price.

Concept:

FRP:

• Fair and remunerative price (FRP) is the minimum price at which rate sugarcane is to be purchased by sugar mills from farmers.
• The Federal/Central Government announces Fair and Remunerative Prices which are determined on the recommendation of the Commission for Agricultural Costs and Prices (CACP) and are announced by the Cabinet Committee on Economic Affairs, which is chaired by Prime Minister.
• The State Advised Prices (SAP) are announced by key sugarcane producing states which are generally higher than FRP.
• The approval will ensure a guaranteed price to cane growers. The ‘FRP’ of sugarcane is determined under Sugarcane (Control) Order.
• This will be uniformly applicable all over the country. Determination of FRP will be in the interest of sugarcane growers keeping in view their entitlement to a fair and remunerative price for their produce.
• Fair and remunerative price (FRP) is the minimum price at which rate sugarcane is to be purchased by sugar mills from farmers.

Commission for Agricultural Costs and Prices (CACP)

• The Commission for Agricultural Costs and Prices (CACP) is an attached office of the Ministry of Agriculture and Farmers Welfare, Government of India. It came into existence in January 1965.
• It is an advisory body whose recommendations are not binding on Government.