top of page

By:

Rajendra Joshi

3 December 2024 at 9:20:26 am

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has...

Sugar industry strains as traders reap profits

Gap between ex-mill prices, retail rates raised questions Kolhapur: The Indian sugar industry is caught in a deepening crisis, with sugar mills struggling to secure remunerative prices for their produce even as traders and middlemen appear to be making substantial profits. While sugar mills are receiving between Rs 4,600 and Rs 4,800 per quintal through recent sale tenders, retail prices have remained as high as Rs 58 per kg. The widening gap between ex-mill prices and retail rates has raised serious questions about the role of intermediaries and the effectiveness of the Centre’s efforts to contain sugar prices. The margins available to traders and intermediaries have reportedly crossed 20 per cent, leaving sugar millers perplexed. At a time when both sugarcane growers and mill operators are under financial pressure, the trading chain appears to be benefiting disproportionately. The Centre must examine this growing disparity and take corrective measures to prevent speculative profiteering. Retail sugar prices began rising sharply in August, touching nearly Rs 70 per kg in some markets. The escalation added to inflationary pressures and caused concern among consumers, particularly ahead of the festive season. In response, the Centre introduced a series of measures to improve domestic availability and moderate prices. These included permitting duty-free sugar imports, initially until October 31, a deadline subsequently extended to December 31. The government also directed sugar mills to commence the crushing season from October 15 and tightened monitoring of sugar stocks. In another significant intervention, it modified the ethanol policy, restricting the diversion of sugarcane juice, sugar syrup and B-heavy molasses for ethanol production. Following these measures, sugar mills began witnessing a decline in the prices offered through their sale tenders. Recent transactions have fetched between Rs 4,600 and Rs 4,800 per quintal. Going by the conventional relationship between ex-mill prices and retail rates, sugar should ideally have been available to consumers at less than ₹50 per kg. However, retail prices continue to hover around Rs 58 per kg, pointing to a substantial disconnect between the mill gate and the consumer market. Traditionally, sugar retailing operated on relatively thin margins. Since sugar is an essential commodity, retailers often treated it as a low-margin product to attract customers who would subsequently purchase other household provisions. The margin was sometimes informally equated with the resale value of the empty 50-kg jute bags in which sugar was supplied. This was considered a nominal return for retailers. That traditional pricing mechanism, however, appears to have undergone a significant change. The widening gap between mill-level tender prices and retail rates has created considerable scope for intermediaries to extract higher margins. The critical question is whether the additional amount paid by consumers is reaching the sugar mills or remaining within the trading chain. The issue assumes particular significance in Maharashtra, where the sugarcane pricing dispute has intensified ahead of the new crushing season. Farmers’ organisations have been demanding a minimum price of Rs 5,500 per tonne for sugarcane. Millers, meanwhile, are preparing to agitate for a revision in the Fair and Remunerative Price (FRP) framework and the restoration of a more supportive ethanol policy. The Swabhimani Shetkari Sanghatana, led by Raju Shetti, has taken a firm position that sugar mills should not be allowed to commence operations until farmers receive an acceptable price for their cane. Shetti has also drawn the state government’s attention to the unusually high retail prices of sugar, questioning why consumers continue to pay more even as mills are forced to sell at relatively lower rates. The Centre’s sudden changes to the ethanol policy have further complicated the industry’s financial position. Ethanol production had emerged as an important revenue stream for sugar mills, enabling them to diversify operations, improve cash flows and enhance their capacity to pay farmers. Restrictions on the diversion of sugarcane-based raw materials have weakened this support at a critical juncture. The resulting contradiction is difficult to ignore: farmers are demanding better cane prices, millers are struggling with shrinking realisations and policy uncertainty, while intermediaries appear to be benefiting from the gap between wholesale and retail prices. The government cannot address the sugar crisis merely by regulating mill stocks, imports and ethanol diversion. It must also examine the entire supply chain, identify where the widening margins are accruing and ensure that the benefits of market interventions reach both sugarcane growers and consumers. With nearly Rs 2 lakh crore riding on the sugar economy, allowing intermediaries to thrive while the industry’s primary stakeholders struggle would be a serious policy failure.

Mahayuti grapples with power struggle

Writer: Abhijit Mulye
Abhijit Mulye
11 minutes ago
6 min read

Jarange’s audio bombshell widens fault lines

Mumbai: The political landscape of Maharashtra has been thrown into turmoil as the ruling Mahayuti alliance grapples with a multi-front crisis threatening its cohesion. At the epicentre of this political upheaval is Shiv Sena leader and Deputy Chief Minister Eknath Shinde’s increasingly public ambition to reclaim the Chief Minister’s post, which is now on a direct collision course with the Bharatiya Janata Party’s long-term expansionist strategy.


This delicate internal power struggle has been dramatically disrupted by Maratha quota activist Manoj Jarange-Patil, who recently released explosive, unverified audio clips alleging a massive, multi-year conspiracy involving top BJP leaders, a rumoured Rs 500 crore payoff and deliberate attempts to sabotage the Maratha agitation. The resulting fallout has exposed serious trust deficits within the Mahayuti, raising critical questions about the survival and future structure of the ruling coalition.


In the cut-throat world of political manoeuvring, the number of allies naturally swells until an individual officially stakes a claim to the highest office. Once that claim is made, distinguishing genuine loyalists from opportunistic bystanders becomes a complex challenge. Current developments in Maharashtra are a textbook illustration of this rule. The push for Shinde’s return to the Chief Minister’s office gained significant public momentum when former Minister of State and Prahar organisation chief Bacchu Kadu formally joined the Shiv Sena, immediately expressing his desire to see Shinde at the helm of the state.


Political Strategy

This endorsement acted as a catalyst, prompting senior Shiv Sena leaders, including Pratap Sarnaik, Gulabrao Patil and Ramdas Kadam, to make strongly favourable statements reinforcing Shinde’s claim. While this chorus of demands is presented to the public as a spontaneous outpouring of grassroots support, seasoned political observers and some insiders suggest a highly orchestrated political strategy, with whispers indicating that these public endorsements were mobilised at Shinde’s own behest to build pressure on his alliance partners.


This concerted campaign for the top post is rooted in the narrative cultivated by Shinde’s camp regarding the Mahayuti’s recent electoral performance. His supporters argue that the 2024 Assembly elections were successfully navigated under his leadership and point to the implementation of populist initiatives such as the ‘Mukhyamantri Majhi Ladki Bahin’ scheme as proof of his ability to decisively sway key demographics, particularly women voters.


Furthermore, Shinde’s frequent visits to New Delhi and his direct, high-level meetings with the BJP’s central leadership have fuelled considerable speculation. It has become increasingly apparent that Shinde enjoys better working relations with the BJP high command in the capital than with the state-level BJP leadership in Maharashtra, a dynamic that adds a layer of complexity to the power-sharing negotiations.


BJP’s Goal

However, the fundamental question remains whether Shinde’s ambitions align with the BJP’s uncompromising political arithmetic. Given Maharashtra’s immense economic and political significance, it is entirely natural that the BJP intends to determine state leadership calculations strictly according to its own strategic interests.


The BJP’s ultimate, publicly stated goal is to secure an absolute majority on its own by the 2029 Assembly elections. To achieve this independent dominance, the party must carefully calculate how much political space it can afford to cede to its regional allies. The BJP must ensure that it retains enough power to aggressively counter the influence of the Maha Vikas Aghadi, specifically targeting the political networks of Sharad Pawar and Uddhav Thackeray, while simultaneously dealing with the Congress party.


The BJP’s central leadership is said to be actively weighing various options for leading Maharashtra on these parameters.


Shinde currently wields considerable administrative power through heavyweight portfolios such as Urban Development and Housing, which give him control over critical wealth-generating and infrastructure bodies such as the MMRDA, CIDCO, MHADA and the Shivshahi Punarvasan Prakalp.


However, his experience tells him that the Chief Minister’s seat offers far greater influence. For him, it is the ultimate vehicle for expanding his party’s organisation, directly influencing policy, rewarding grassroots workers and forging an independent political identity. The BJP is acutely aware that allowing Shinde to hold the Chief Ministership could strengthen the Shiv Sena to the point where it becomes an obstacle to the BJP’s ambitions of going it alone in 2029, creating a precarious balancing act between maintaining the current coalition and preparing for future dominance.


Jarange Factor

This high-stakes chess match within the Mahayuti was abruptly derailed by Manoj Jarange-Patil following his Dussehra rally at Narayangad in Beed. The Maratha activist directly challenged Deputy Chief Minister Shinde, demanding immediate answers from the rally stage, and subsequently held a widely publicised press conference at which he dropped a political bombshell by playing audio clips of conference calls that purportedly exposed a sprawling conspiracy against him.


According to Jarange-Patil, the audio clips reveal a systematic, three-year plot to defame him, crush the Maratha reservation movement through injustice and deliberately harass the Maratha community.


The recordings, which mention the names of prominent BJP leaders Niranjan Davkhare and Pravin Darekar, allegedly feature discussions about how to politically damage Jarange-Patil before he could “swallow up” the Marathwada region. One of the most explosive segments of the recording features a woman’s voice stating that Jarange-Patil had already received Rs 500 crore, specifically claiming that the funds were routed through MP Dr Shrikant Shinde, the son of Eknath Shinde.


Foreign Interference

The leaked conversations delve into deeply sensitive and highly polarising political strategies. The voices in the clip allegedly discuss exploiting the “OBC-ification” of the Maratha community and leveraging narratives around “Vote Jihad” to inflame communal and political tensions. The recordings purportedly refer to the Love Jihad controversy in Sambhajinagar, noting the absence of protests, and even discuss spreading propaganda that American operatives are roaming Maharashtra in an attempt to turn the state into another Bangladesh.


The clips also allegedly mention the use of official BJP party funds to finance Jarange-Patil’s local opponents, while simultaneously detailing a parallel plot to personally target and defame Deputy Chief Minister Devendra Fadnavis.


Furious and defiant, Jarange-Patil issued stern ultimatums to the state leadership. He demanded that Prime Minister Narendra Modi, Devendra Fadnavis and Eknath Shinde immediately uncover the identities of the strategists operating behind the scenes, and called for the conspirators to be sent to ‘Kala Pani’ or sentenced to life imprisonment. He issued a direct warning to Shinde to rein in his people, threatening to release further damaging WhatsApp call records in the coming months.


Underscoring the severity of his threats, Jarange-Patil explicitly named several ministers, including Pratap Sarnaik, Uday Samant, Chivate, Abdul Sattar, Suhas Kande, Dada Bhuse and Deepak Kesarkar, warning them that their political careers would be utterly destroyed if the harassment did not cease.


Questionable Timing

The Shiv Sena immediately launched a fierce counter-offensive, attempting to shift the burden of proof while pointing accusatory fingers squarely at its alliance partner, the BJP. Senior Shiv Sena leader Ramdas Kadam addressed the media, adopting a tone of betrayal and tactical scrutiny. Kadam pointed out a glaring chronological discrepancy, noting that the primary audio clip presented by Jarange-Patil was dated October 14, 2024.


Questioning the activist’s motives, Kadam demanded to know why Jarange-Patil had concealed the recording for two years, keeping it hidden through the crucial Assembly and Lok Sabha elections of 2024 and 2025.


While appealing to Jarange-Patil not to fracture the historical unity of the Maratha community, Kadam made a striking admission: he explicitly confirmed that the voices on the audio clip belonged to BJP members. Kadam further revealed that a BJP MLA had been secretly attending Jarange-Patil’s confidential meetings, alleging that the activist himself had said during one of these meetings that more than half the attendees were “Eknath Shinde’s sycophants”.


Kadam demanded an immediate, comprehensive investigation into the woman’s voice claiming that a Rs 500 crore transaction had taken place, sought answers about the source of the alleged funds and urged a united front to defeat any party attempting to defame Eknath Shinde.


Resembling Voices

Taking the counter-attack further, Industries Minister Uday Samant held a press conference in Kolhapur, explicitly naming specific BJP figures. Samant alleged that the voices in the defamatory audio clip closely resembled those of BJP spokesperson Shweta Shalini, BJP MLA Atul Bhatkhalkar and YouTuber Sushil Kulkarni.


Urging Chief Minister Devendra Fadnavis to immediately order a comprehensive forensic and cyber cell investigation, Samant demanded that voice samples of the accused be tested at a state laboratory. He challenged the BJP to clarify its position publicly and detail the disciplinary action it would take if the involvement of its members were established through forensic tests, while vehemently defending MP Shrikant Shinde against the Rs 500 crore allegation.


The convergence of Eknath Shinde’s unyielding chief ministerial ambitions and the damaging intra-alliance suspicions triggered by the Jarange-Patil audio clips has pushed the Mahayuti to the brink. The BJP finds itself in an extremely precarious position, forced to manage the growing demands of a powerful regional ally while simultaneously facing calls from that same ally to investigate its own party spokespersons and MLAs for alleged criminal conduct.


The Maratha quota agitation, far from being resolved, has evolved into a political tool capable of fracturing the ruling coalition from within. As the state awaits the BJP’s official response to the demands for a forensic probe and Shinde’s leadership ambitions, the overarching question dominating Maharashtra’s political discourse remains unanswered: how long can an alliance survive when its partners are actively preparing for a future without each other?

Comments

bottom of page