What is driving so many farmers in Karnataka to grow sugarcane?

More and more farmers are cultivating sugarcane in recent years. In the last 6-7 years, the area under sugarcane has nearly doubled in Karnataka and Maharashtra, though it has gone up only partially across the country

Updated - May 24, 2024 10:59 am IST

Published - May 24, 2024 09:00 am IST - Belagavi

Sugarcane-cutting labourers load the harvested crop to trucks near Nandagad in Khanapur taluk on Friday. The reduced rainfall has enabled farmers to harvest their sugarcane across the district.

Sugarcane-cutting labourers load the harvested crop to trucks near Nandagad in Khanapur taluk on Friday. The reduced rainfall has enabled farmers to harvest their sugarcane across the district. | Photo Credit: BADIGER PK

Sugarcane (Saccharum officinarum), a grass that was domesticated in Papua New Guinea over 6,000 years ago, has over the years become one of the world’s largest crop in terms of area of cultivation. Its various hybrids are cultivated by farmers in the rotund cropping method on multi-year cycles. Seeds sown once are harvested for three-four years. The most popular variety is Nayana (Co -86032), that occupies nearly three fourth the total cultivated area in Karnataka. Farm sciences universities and research centres are busy developing new climate resistant and high sugar-loaded varieties.

S Nijalingappa sugar institute in Belagavi.

S Nijalingappa sugar institute in Belagavi. | Photo Credit: BADIGER PK

Spurt in area

More and more farmers are cultivating sugarcane in recent years. In the last 6-7 years, the area under sugarcane has nearly doubled in Karnataka and Maharashtra, though it has gone up only partially across the country. In Karnataka it increased to 6.9 lakh hectares from 3.7 lakh hectares between 2016-2023. Acreage in Maharashtra has increased to 13.5 lakh hectares from 9 lakh hectares in the same period. Pan -India, the crop has touched 59 lakh hectares from 47 lakh hectares in these years.

The Union government’s biofuel drive that is pushing for increased ethanol adoption in petrol vehicles, discovery of several by products of sugarcane that are not bound by limiting laws like levy allocation, relaxed export policies, and improved efficiency of extraction, processing and fermentation technologies, are said to be the reasons behind this unprecedented hike.

Third highest producer of sugarcane
Karnataka is the third largest sugarcane producing state in the country, after Uttar Pradesh and Maharashtra. Most of the crop is grown in 13 states. Karnataka grows the cash crop on about 4.75 lakh hectares. Sugarcane is grown in 16 districts in Karnataka. Seven of them — Belagavi, Bagalkot, Vijayapura, Mandya, Mysore, Chamrajnagar and Bidar — are the major sugarcane producing districts.

“The main reason is how much and how fast industry is putting money in the farmers’ pocket. Farmers are abandoning other crops as they do not fetch remunerative prices,’‘ said Sidagouda Modagi, farmers’ leader and Krishik Samaj president. He pointed out that though the Union government declares MSP for nearly 30 other crops, there is no systematic mechanism for their procurement. “Sugarcane is the only crop where FRP is announced one year in advance. Factories not only stick to it, but also offer higher prices to attract farmers. That explains the rush towards it,’‘ he said.

Other food processing industries are engaging in contract farming by signing agreements with individual farmers. “Sugar industry is the only organised buyer. What is more, it is not easy for small farmers to grow other cash crops like tobacco, areca, rubber or spices. That is why sugarcane has become a much sought after crop,’‘ Modagi explained. He demanded that the government should redraft laws to make factories share the profits realised by selling all by products with sugarcane suppliers, and to make agreements between farmers and factories legally binding.

Farmers and labourers engaged in harvesting and loading of sugarcane in Belagavi district.

Farmers and labourers engaged in harvesting and loading of sugarcane in Belagavi district. | Photo Credit: BADIGER P K

Several byproducts

Sugar mills can produce over a dozen byproducts, with incremental investments and minor modifications in their machinery, experts say. A report by the State-run S. Nijalingappa Sugar Institute in Belagavi has identified ethanol, oxygen, co-generated electricity, green hydrogen, bio-CNG, bio-compost, haemoglobin based proteins, calcium carbonate, acetylene and aldehides, apart from traditional products like bagasse, molasses, press mud and biodegradable paper and plates as some products. Apart from running graduate and post graduate courses in sugar and alcohol technology, SNSI develops new varieties, trains farmers and sugar industry personnel.

Gap between yield and acreage
Uttar Pradesh stands at the top of sugarcane producing states, with around 178 million tonnes, Maharashtra second with 92 million tonnes and Karnataka with 43 million tonnes. The yield of the crop, however is significantly different. Tamil Nadu with a total production of 104 tonnes per hectare, is in first place and Karnataka with 91 tonnes per hectare is at the second place and Maharashtra with 86 tonnes per hectare is at the third place. UP is at the seventh place with 81 tonnes per hectare.

“A sugar factory can also build a circular economy around itself by producing innovative by-products, engaging with farmers and increasing their income,’‘ said Rayappa Khandagave, director, SNSI.

At a recent national workshop on “Beyond Ethanol”, SNSI suggested to sugar factories that they could build farmers communities, facilitate solar energy production by individual farmers and help them connect to the grid. “Factories can thus become mass renewable energy producers. They can also diversify into other crop based food processing industries like milk, soya, millets and protein supplements, and share their profits with farmers if possible. Thus, both the factory and the farmers will grow,’‘ Khandagave said.

Temporary sheds put up by sugarcane cutting and factory labourers outside a factory in Bagalkot district.

Temporary sheds put up by sugarcane cutting and factory labourers outside a factory in Bagalkot district. | Photo Credit: SPECIAL ARRANGEMENT

Ethanol economy

“Ethanol has become a hope for the future. It will not only help farmers, but also the factories,’‘ says Shivanand Patil, Minister for Sugar and Sugarcane Development. “When we started factories a few decades ago, we depended only on sugar, whose price and quantum was controlled by the government. But now, there are several by products including ethanol, whose trade is not restricted. This has radically boosted the finances of the factories. While old factories are enhancing their crushing capacities, new ones are being set up. Some factories have expanded capacity by 4-5 times. All this will benefit farmers’‘ the minister said.

Sugar factories also increase
India has over 700 installed sugar factories in the country with crushing capacity of about 340 lakh MT of sugar. Karnataka has 76, around 65 situated in northern Karnataka and 12 in southern Karnataka. Their number and installed capacity has increased 2.5 times in less than 10 years. Many of them are owned by political powerful families, especially in north Karnataka.

The average ethanol blend in the State is around 11% now. Union government has set a target of 20% by 2025-26. The current price of ethanol is around ₹55 per litre, that helps farmers get 2-3% more per tonne of sugarcane supplied. “Last Thursday, the oil manufacturing companies placed orders for ethanol valued at ₹ 66 crore. This is expected to increase by nearly 80% next year,’‘ officials say.

However, leaders like Laxman Savadi, former deputy Chief Minister, are sceptical about the ethanol economy. He feels that factories will go slow on increasing ethanol output as the OMCs are underpaying them. “Compared to the factories, the OMCs are making twice the money for half the effort. Unless the government addresses this issue, I do not foresee an ethanol revolution,’‘ he said. The Sangamesh Sugar Factory in Athani in which he is a director, is yet to put up an ethanol plant, he pointed out.

Farmers taking sugarcane to a nearby sugar factory near Belagavi.

Farmers taking sugarcane to a nearby sugar factory near Belagavi. | Photo Credit: BADIGER P K

Polarising crop

Sugarcane remains a highly polarising crop. Opposition to the crop is based on factors ranging from ecology to health. Sugarcane needs more water per unit area than most crops. It also tends to damage the soil quality due to mono cropping, owing to repeated cultivation on the same land and high chemical input use. Increased health consciousness has also made the new generation reject sugar and look for alternative sweeteners. Another is the allegation that sugarcane is a “political crop”, that can influence electoral outcomes.

Recovery varies from State to State
Sugar production is counted as a percentage of the commodity produced by crushing and processing the crop. States like Chhattisgarh, Gujarat and Telangana have percentages higher than 10, and most other states clock a recovery percentage of around 7-9. Some factories in Maharashtra, however, have achieved recovery rates between 12-14. Recovery in southern Karnataka is around 9% while that in northern Karnataka is around 12%.

However, those who support it, including farmers, look at it as a commercial crop that has an assured organised market that assures good returns year on year. It is not difficult to maintain, has easy disposal and ensures timely payment of farm gate prices, which is rare in other crops, they argue.

It is a vital cash crop that sustains the second biggest agro-based industry in the country after textiles. It is a low-risk crop that assures farmers minimal returns even in adverse climatic conditions. On an average, a farmer growing sugarcane on one-acre harvests around 30-40 tonnes. It has a fair and remunerative price of ₹3,145 per tonne currently. The profit per acre is up to ₹ 20,000 - ₹40,000 per acre, as per the agriculture department’s input-output estimates. Farm gate prices are as realised at the farmer’s field. The factories that harvest and transport the produce deduct ₹700 per tonne from the FRP.

Sugarcane is a low-risk crop that assures farmers minimal returns even in adverse climatic conditions.

Sugarcane is a low-risk crop that assures farmers minimal returns even in adverse climatic conditions. | Photo Credit: MAHADEVA B

Says Khandagave, “A few years ago, some officers of the Union government were seeking our opinion on whether it would be wise to discourage sugarcane as it is considered a water guzzling crop. Then, we studying the economics of sugarcane. We found out that it was the only crop that brought them assured returns over the years. Banana came a far second. No other crop, including those who have a minimum support price announced by the union government, came close.’‘

Focus on drip irrigation

However, SNSI and farm sciences universities have been urging farmers to switch to drip irrigation. There is empirical evidence to show that drip irrigation saves 50% water and increases yield by over 50%. “There are instances in Maharashtra and Karnataka where farmers have harvested 100 tonnes per acre, against the average of 35 tonnes per acre,’‘ the director said. Farmers have been asked to take up rotary tilling of green manure and mulching to improve soil quality.

Why ethanol is getting a push
Ethanol is among the dozen-odd by products that can be made from sugarcane. All new age factories and most traditional units are producing ethanol. The Union government’s push for increased blending of ethanol with petrol to 20% by 2025-26 may not only prompt more factories to put up plants, but also increase the number of sugar and ethanol factories.

“We have recommended sugar factories to set up plants to extract sugarcane from beetroot and tried to create awareness among farmers to take up beetroot cultivation, said Ashok Dalwai,’‘ CEO of the national rain-fed area authority. This will address the concerns of water usage and help farmers better use the land as beetroot takes around six months to grow compared to sugarcane that needs one year to mature, according to him.

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