New Delhi, The government on Tuesday raised the minimum price that sugar mills must pay to sugarcane growers by Rs 10 to Rs 365 per quintal for the 2026-27 season beginning October.
The Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, approved the Fair and Remunerative Price (FRP) for sugarcane at its meeting here.
"The FRP will be Rs 365/quintal for a basic recovery rate of 10.25 per cent," Union Minister Ashwini Vaishnaw told reporters after the meeting.
The approved FRP is 2.81 per cent higher than the current 2025-26 season rate of Rs 355 per quintal.
For every 0.1 per cent increase in recovery above 10.25 per cent, the FRP will rise by Rs 3.56 per quintal, incentivising higher sugar recovery by mills.
With a view to protecting the interests of farmers supplying cane to mills with recovery below 9.5 per cent, the government has decided that there will be no deduction in FRP in such cases. Farmers supplying to such mills will receive Rs 338.3 per quintal in the 2026-27 season.
While the production cost of sugarcane for 2026-27 has been pegged at Rs 182 per quintal, the FRP fixed is 100.5 per cent higher than the production cost.
"Farmers are expected to get more than Rs 1 lakh crore," Vaishnaw said.
The decision is expected to benefit nearly one crore sugarcane farmers, support farm labourers engaged in sugarcane cultivation and ensure the continued operation of sugar factories, the minister said.
The FRP has been fixed on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP) and after consultation with state governments and other stakeholders.
The sugar sector impacts the livelihoods of about five crore sugarcane farmers and their dependents, and around five lakh workers directly employed in sugar mills, apart from those engaged in ancillary activities, including farm labour and transportation.
Sugar mills are mandated to purchase sugarcane from farmers at the FRP or above.
The FRP has been increased every year over the last ten years, Vaishnaw said.
The move will also enable ethanol production from surplus sugarcane, he added.
On cane dues, in the previous 2024-25 season, out of total dues payable of Rs 1,02,687 crore, about Rs 1,02,209 crore, nearly 99.5 per cent, has been cleared as of April 20, 2026.
In the current 2025-26 season, out of dues payable of Rs 1,12,740 crore, about Rs 99,961 crore, or 88.6 per cent, has been paid to farmers.
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"The FRP will be Rs 365/quintal for a basic recovery rate of 10.25 per cent," Union Minister Ashwini Vaishnaw told reporters after the meeting.
The approved FRP is 2.81 per cent higher than the current 2025-26 season rate of Rs 355 per quintal.
For every 0.1 per cent increase in recovery above 10.25 per cent, the FRP will rise by Rs 3.56 per quintal, incentivising higher sugar recovery by mills.
With a view to protecting the interests of farmers supplying cane to mills with recovery below 9.5 per cent, the government has decided that there will be no deduction in FRP in such cases. Farmers supplying to such mills will receive Rs 338.3 per quintal in the 2026-27 season.
While the production cost of sugarcane for 2026-27 has been pegged at Rs 182 per quintal, the FRP fixed is 100.5 per cent higher than the production cost.
"Farmers are expected to get more than Rs 1 lakh crore," Vaishnaw said.
The decision is expected to benefit nearly one crore sugarcane farmers, support farm labourers engaged in sugarcane cultivation and ensure the continued operation of sugar factories, the minister said.
The FRP has been fixed on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP) and after consultation with state governments and other stakeholders.
The sugar sector impacts the livelihoods of about five crore sugarcane farmers and their dependents, and around five lakh workers directly employed in sugar mills, apart from those engaged in ancillary activities, including farm labour and transportation.
Sugar mills are mandated to purchase sugarcane from farmers at the FRP or above.
The FRP has been increased every year over the last ten years, Vaishnaw said.
The move will also enable ethanol production from surplus sugarcane, he added.
On cane dues, in the previous 2024-25 season, out of total dues payable of Rs 1,02,687 crore, about Rs 1,02,209 crore, nearly 99.5 per cent, has been cleared as of April 20, 2026.
In the current 2025-26 season, out of dues payable of Rs 1,12,740 crore, about Rs 99,961 crore, or 88.6 per cent, has been paid to farmers.
