Gujarat : Sugar Mills See Sweet Profits Sour Under Mandatory Jute Bag Order

Surat : The sugar factories of South Gujarat are facing a bitter pill to swallow, with the Central Government’s recent mandate to pack 20% of their total sugar production in jute bags during the 2023-24 season. This move, intended to boost the struggling jute industry, is estimated to cost sugar mills in the region a staggering Rs 20 crore, and raise concerns about its impact on farmers and consumers.

Darshan Naik, director of Sayan Sugar mill, points out the current practice of packing processed sugar in polypropylene (PP) woven bags. The new directive, however, forces them to switch to jute bags, significantly inflating their production cost. With 14 sugar factories in South Gujarat producing 10.50 lakh metric tonnes of sugar annually, the switch to jute bags would translate to a need for 36 lakh bags.

The stark price difference between the two materials paints a grim picture. While a PP bag costs Rs 18.50, a jute bag comes at a hefty Rs 72.50. This translates to an additional Rs 53.50 per bag, or a total of Rs 20 crore for the entire sugar production of the region. Naik emphasizes that this burden will ultimately fall on the shoulders of the farmer members of the sugar cooperatives, threatening their already fragile profits.

The issue isn’t limited to cost. Naik also raises concerns about the availability of the required quantity of jute bags within India. With the domestic jute industry struggling to meet demand, sourcing these bags could become a logistical nightmare, potentially leading to delays and disruptions in sugar production and distribution.

The mandatory jute bag order has sparked anxieties among sugar mills, farmers, and potentially, consumers. While the government’s intention to support the jute industry is commendable, the execution raises concerns about its practicality and potential negative consequences. The sugar factories are urging the government to reconsider the order, seeking alternative solutions that don’t jeopardize the livelihoods of farmers and the stability of the sugar industry.