IN THE RED: Trucks laden with sugarcane at NVR Cooperative Sugars at Jampanion Thursday. — Photo: T Vijaya Kumar

TENALI: Dark clouds are hovering over Nannapaneni Venkata Rao Cooperative Sugar Factory at Jampani village in Vemuru mandal, the only one among the 11 sugar factories in the State with an elected body at the helm of its affairs.

Dogged by the scarcity of skilled labour and the lack of latest machinery to handle large volumes of sugar cane, the factory has been hit by a fresh crisis as the price of sugar has plummeted to just above Rs.1, 300 per quintal this March as against Rs.1,600 in 2006, forcing the factory management to delay the payments due to sugarcane farmers almost by a month, triggering resentment from the growers.

Remunerative prices

To tide over the crisis, the factory secured a loan from Andhra Pradesh State Cooperative Bank Limited and was paying the farmer an assured sum of Rs.1,050 per metric tonne. "The last time the prices of sugar plummeted was in 1990s, but then we were paying farmers a remunerative price of only Rs.500 and were able to buffer the losses. But now, the situation is challenging as prices of sugar have crashed in the global market and the remunerative prices have doubled,'' says Managing Director M. Janardhana Rao.

Ironically, the market price is less than the Central Government's levy price at Rs.1,365 per metric tonne, the rate at which the sugar factories had to sell 10 per cent of their annual production to the Centre.

The factory had also been hit by a scarcity of skilled labour with the management being forced to source labour from the neighbouring Tamil Nadu and Kerala. The outdated machinery, which had a limited capacity to handle 1,250 metric tonnes of cane was adding to its woes.

Exports

Crushing season started in the first week of December on a promising note. The factory had so far handled 1.27 lakh metric tonnes of cane producing 1,11,030 quintals of sugar. "We hope to handle 1.45 lakh metric tonnes of cane by the end of the season in the first week of April,'' says chairman of the cooperative body, Nannapaneni Linga Rao. However, there was a silver lining in the cloud as there were indications that sugar prices might go up and stabilize by the time the crushing season ends.

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