The Central Government has approved a Rs. 15 per quintal increase in the Fair and Remunerative Price (FRP) of sugarcane for the 2025–26 crushing season.
With this hike, the new FRP stands at Rs. 355 per quintal, up from the existing Rs. 340 per quintal, based on a 10.25% sugar recovery rate.
Keeping in view interest of sugarcane farmers, the Cabinet Committee on Economic Affairs chaired by the Prime Minister Narendra Modi has approved FRP of sugarcane for sugar season 2025-26 (October – September) at Rs.355/qtl for a basic recovery rate of 10.25%, providing a premium of Rs.3.46/qtl for each 0.1% increase in recovery over and above 10.25%, & reduction in FRP by Rs.3.46/qtl for every 0.1% decrease in recovery.
However, the Government with a view to protect interest of sugarcane farmers has also decided that there shall not be any deduction in case of sugar mills where recovery is below 9.5%. Such farmers will get Rs.329.05/qtl for sugarcane in ensuing sugar season 2025-26.
The cost of production (A2 +FL) of sugarcane for the sugar season 2025-26 is Rs.173/qtl. This FRP of Rs.355/qtl at a recovery rate of 10.25% is higher by 105.2% over production cost. The FRP for sugar season 2025-26 is 4.41% higher than current sugar season 2024-25.
The FRP approved shall be applicable for purchase of sugarcane from the farmers in the sugar season 2025-26 (starting w.e.f. 1st October, 2025) by sugar mills. The sugar sector is an important agro-based sector that impacts the livelihood of about 5 crore sugarcane farmers and their dependents and around 5 lakh workers directly employed in sugar mills, apart from those employed in various ancillary activities including farm labour and transportation.
The move comes after demand from sugarcane farmers across the country, to hike FRP due to rising input costs, including fuel prices, labour expenses, and delayed payments from mills.
The FRP is the minimum price that sugar mills must pay farmers for their sugarcane, as fixed by the central government to ensure fair compensation.
This increase is expected to bring direct economic benefits to farmers. However, it could also lead to higher production costs for sugar mills.
Meanwhile, sugar mills have been urging the government to raise the minimum selling price (MSP) of sugar, citing increased operational and procurement costs.
The government’s decision is likely to have a significant impact on both the agriculture and sugar industries ahead of the upcoming crushing season.
