Centre sets up Ramesh Chand-led panel to review sugar MSP, farmers’ returns

The Centre has constituted a committee under former NITI Aayog member Professor Ramesh Chand to examine issues raised by sugarcane farmers, including demands for higher remunerative returns and a revision in the minimum selling price (MSP) of sugar.

The committee will recommend measures to address concerns raised by sugarcane farmers and examine issues affecting the broader sugar sector.

The committee was constituted following a meeting between representatives of sugarcane farmers from Karnataka and Maharashtra and the Union Ministers for Agriculture and Farmers Welfare, and Consumer Affairs, Food and Public Distribution.

One of the key terms of reference is to examine the demand for an increase in remunerative returns to sugarcane farmers, taking into account cultivation costs and other relevant factors.

The panel will also examine demands for a revision in the ex-mill minimum selling price of sugar, considering sugar production costs, market realisations and the financial viability of sugar mills.

The review comes against the backdrop of continuing concerns over the balance between remunerative returns for sugarcane farmers and the financial sustainability of sugar mills. Any revision in the minimum selling price could have implications for mill realisations and the economics of sugar production. However, the government has not announced any immediate change in the price.

Sugar recovery, weighing practices under scrutiny

The committee will also review the existing mechanisms for testing and reporting sugar recovery and examine measures to ensure transparent verification of recovery levels.

Sugar recovery refers to the quantity of sugar produced from a given quantity of sugarcane and is an important factor in determining the economics of sugar production.

The panel will assess prevailing sugarcane weighment practices at mills, including the adequacy of calibration, inspection and verification mechanisms. These measures are intended to address concerns regarding the accuracy and transparency of weighing procedures.

Another key area of examination will be deductions from the weight of mechanically harvested sugarcane. The committee will assess the extent of actual losses, if any, arising from mechanised harvesting and evaluate the financial impact of existing deduction practices on the cane price payable to farmers.

The panel may also consider other related matters it deems necessary.

Committee to consult farmers, mills and states

The committee will consult stakeholders, including farmers’ representatives, sugar mill associations, state governments and other experts or organisations, as required.

It will submit a report containing its findings and specific recommendations as early as possible for consideration by the competent authority.

Apart from Professor Ramesh Chand, the committee comprises the Agriculture Commissioner in the Ministry of Agriculture and Farmers Welfare, the Joint Secretary (Sugar) in the Department of Food and Public Distribution, and the Joint Secretary (Legal Metrology) in the Department of Consumer Affairs.

Professor Chand served as a member of NITI Aayog from 2015 to 2026. He previously served as Director of the ICAR-National Institute of Agricultural Economics and Policy Research and as a member of the Fifteenth Finance Commission.

The committee’s recommendations will be considered by the competent authority, with any subsequent policy decisions depending on the outcome of the review.