Raising the MSP of Sugar Is Essential for Timely Payment to Cane Farmers

08-Dec-2025 05:17 PM

Mumbai. The domestic sugar industry is continuously putting pressure on the central government to raise the ex-factory Minimum Selling Price (MSP) of sugar. According to the industry, over the past five to six years, the cost of sugar production has risen sharply due to various reasons, yet the MSP has remained unchanged. As a result, millers are facing severe difficulties in making timely payments to sugarcane farmers. This issue requires serious consideration.

It is noteworthy that every year, the central government increases the Fair and Remunerative Price (FRP) of sugarcane, and states also raise the State Advisory Price (SAP). Due to this, the cost of sugar production has climbed to ₹3,900–4,000 per quintal. On the other hand, there has been no revision in the MSP of sugar since 2021. At that time, the MSP was raised from ₹2,900 per quintal to ₹3,100 per quintal—an increase of just ₹200. Thus, there remains a huge gap of ₹800–900 per quintal between the actual production cost of sugar and its minimum selling price.

The industry argues that the MSP of sugar must be increased in line with the annual hikes in FRP and SAP so that millers can pay sugarcane farmers on time without difficulty. The FRP of sugarcane, which was fixed at ₹275 per quintal in the 2019–20 season, has steadily increased to ₹355 per quintal in the 2025–26 season—an increase of 29%. Consequently, the production cost of sugar has also risen. In Maharashtra and Karnataka, the production cost of sugar is estimated at around ₹3,750 per quintal, while at the national level it is about ₹3,900 per quintal.