AS the cane crushing season gains momentum in Punjab, growers say they find themselves stuck between a rock and a hard place.

The millers have turned more innovative to maximise their margins at the cost of growers. And the government has maintained the same indicative price (Rs180/40kg) for the third consecutive year. The situation is further rigged against the farmers by unbecoming weather over the last few months.

The farmers say that traditionally the middlemen made money by establishing weighing machines with in a few kilometre radius of the mills, getting cane from farmers at a slightly low price — saving the farmers the hassle of long waits at the mills’ gates — and paying farmers cash or clearing payment within the next few days.

The mills have now established their own weighing machines and even desks within the mill premises, where they are making two kinds of cuts: on sucrose recovery and weight.

Farmer reports from central Punjab suggest cane sale at as low as Rs150/40kg. The millers, however, deny any rate reduction

The prevailing rate has dropped to Rs163/40kg (against official rate of Rs180/40kg) — Rs15 in the name of quick purchase and Rs2 in the name of road cess.

With millers laying out their own paraphernalia and excuses to rob the farmers, the middlemen have reduced the rate further. Reports from central Punjab suggest sale at as low as Rs150/40kg.

The millers, however, deny any rate reduction. The sugar rate in the market is much better than last year because of export of 250,000 tonnes then. They say it has enabled the country to have a clear domestic glut as they are making on-time payments and stabilising sugar prices around the actual cost of production. It was because of this export, the country has been able to maintain cane acreage.

The millers are asking the government of allow 500,000 tonnes export for this season, even without any rebate so that glut does not return to ruin trade, millers said.

The farmers also blame Mother Nature for robbing them of their due profits this year. For the last four months, the dry spell has played havoc with the crop on two accounts: increasing cost of production and weight loss in the final yield. The growers had to shift the expensive running of the tubewells to supplement water supplies, which added almost 10-15pc to their cost during this period.

Those, who were not fortunate enough to have their own tubewells or afford purchasing water, suffered heavy losses in weight. Even those who ran their water supplies on tubewells feel that rainwater helps grow faster and healthier crop.

On top of it both, the dry spell has provided the millers with an excuse to effect rate cuts on the basis of less sucrose content.

The millers would sure suffer some loss on this basis, but the farmers’ case is that the rate is never linked to sucrose recovery.

Published in Dawn, Business & Finance weekly, December 12th, 2016