ONGOLE: District Collector B Udaya Lakshmi has enhanced the price of subabul and eucalyptus by Rs. 150 a ton with effect from January 1 ignoring the pleas of the paper mills that they cannot pay any price higher than this year for the produce.

She convened a meeting of farmers and paper mill representatives here on Tuesday to announce the price for next year. Farmers demanded that they be paid Rs. 200 a ton more than last year to make it remunerative.

Market cess

But representatives of paper mills flatly refused to increase the price even though Mrs Udaya Lakshmi persuaded them to contact their head offices and come for negotiation. So she finally announced the price hike.

Representatives of paper mills however agreed to pay 1 per cent market cess. The market committees were collecting the cess from farmers before.

They also agreed to provide bank guarantee to market committees for their purchases to resolve the revolving fund problem.

Following agitations for remunerative price by farmers, the district administration evolved a marketing system.

All farmers are required to sell their produce through regulated market yards and millers should pay the price fixed by the Collector.

The market committees used to pay the farmers from their revolving fund and recover the price from millers later. The system had worked well for the last three years. But the Government objected to the market committees using their revolving fund for paying the farmers leading to some problem this year.

Then paper mills were asked to deposit money with the market yards or provide bank guarantee to the extent that they bought. District secretary of the CPI(M) N Ranga Rao said the farmers would stop sales if the millers refused to implement the price announced by the Collector.

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