Sugarcane planting declines in Tamil Nadu due to high cultivation cost 

Despite good improvements in the sugarcane area and yield in Tamil Nadu in recent years, fresh sugarcane cultivation has been hit hard all over the state due to the high cost of cultivation, according to N Gopala Ratnam, Chairman of the Board of Directors. Ponni Sugar (Erode) Ltd.

Sugarcane cultivation has picked up well in Tamil Nadu over the past two years due to the resumption of monsoons and thus improved water availability.

However, it is gathered that farmers’ interest in growing fresh sugarcane in Tamil Nadu is now waning due to abnormally high agricultural labor costs coupled with the resurgence of competitive crops which enjoy better remuneration.

“The cost of labor in Tamil Nadu is almost 2-3 times when compared to the rates prevailing in major cane-producing states like Uttar Pradesh. Effective price of sugarcane, including transportation, is the company’s 27th annual general meeting,” Gopala Ratnam said while addressing the company’s 27th Annual General Meeting. , for Tamil Nadu factories is already much higher as compared to its peers.

This impedes and weakens the ability of sugar mills to further stimulate sugarcane farmers through additional subsidies. He said that concerted efforts to enhance mechanization, improve sugarcane productivity and enhance sucrose content through different types of sugarcane will be the company’s priority areas of work to combat this challenge.

Meanwhile, the ₹ 450 crore company gets environmental clearance for its ethanol project.

Ponni Sugars was one of the first movers to design a 45 KLPD distillery and ethanol plant in June 2019 and receive interest subsidy support. However, it still faces hurdles in obtaining an environmental permit.

Ethanol production is increasingly coming from heavy B molasses and sugarcane juice rather than earlier production from molasses. Hence, the ethanol plant must be located within the sugar mill complex as an integral part of it. Moreover, for its long-term sustainability, the project must have a flexible product mix compatible with the market dynamics in its composition.

While the Government of Tamil Nadu in October 2021 relaxed local restrictions on ethanol, it has not been explicitly extended to the production of other allied products such as ENA (Extra Neutral Alcohol) and RS (Rectified Spirit). However, the ‘Ethanol Blending Policy 2023’ recently issued by the Government of Tamil Nadu seeks to comprehensively address the diverse issues involved in ethanol projects. It also states the ‘Approval to Work’ issued by the Pollution Authority to specifically cover ENA, RS, etc.

Therefore, in conjunction with this policy, the company hopes that its project will obtain the required environmental permit. However, in the meantime, the government’s Rs 58 crore subsidy support for the ethanol project has lost interest over time. I decided to receive an invitation regarding the ethanol project after obtaining an environmental permit.