Govt mulls diversion of cane crushing to Vellore

Sugar mill when crushing starts in November this year, as the latter, with its new machinery, is less likely to make a loss, according to informed sources.

The thinking in official circles is that the Vellore unit with its 16 MW bagasse-based co-generation plant will earn profit as the plant produces enough power to run the mill without having to rely on Tangedco supply. With additional power being diverted to the state power grid, the mill is in a comfortable position and is currently undertaking machinery maintenance to ensure on-time start of cane crushing.

This is because the present drought is expected to affect sugar cane cultivation in Vellore district and the three sugar mills anticipate reduced crushing and sugar production due to the current water crisis. Three decades ago, the three mills had a total installed cane crushing capacity of 7500 TCD (Tonnes Crushed Daily) and the registered cane area of the threemills was around 25,000 acres. Then, the only fear the mills had was regarding diversion of cane for jaggery crushing if prices offered by jaggery traders was more attractive than prices offered by the mills.

But today, the scenario has changed so much that only the Vellore mill has a crushing capacity of 2500 TCD while it is 1250 TCD for the Tirupatthur mill and 1400 TCD for the Ambur unit. Reduction in crushing capacity follows the total area under sugar cane coming down in Vellore district.The erstwhile North Arcot district had huge cane tracts but the acreage dwindled to 11, 250 acres in Vellore district when North Arcot was bifurcated into Vellore and Tiruvannamalai districts three decades ago.

Farmers were too happy with sending cane to the Vellore mill due to timely payment of cane dues. Farmer VS Boopal of Kannamangalam in Tiruvannamalai district said “though we were originally with the Vellore mill, we were attached to the Ambur mill despite the Vellore unit being closer.”Vellore sugar mill chairman M Anandan told this correspondent  that “cane dues amounting to Rs.27 crore was paid to farmers till the end of the last crushing season and now only Rs.3 crore was outstanding, and we plan to convert this to thecentral government’s “ways and means advances” as shares in farmers names.”

Though the Ambur mill started in 1969 is the oldest unit in the district and once crushed 2500 TCD, it today has a downgraded capacity of 1400 TCD. While it Crushed 1.23 lakh tonnes to produce 1.11 lakh quintals sugar in 2014-15, it was able to crush only 67,000 tonnes producing 52 ,000 quintals sugar in the lastSeason (2018-19). “Sugar recovery of 9.06% in 2014-15 fell to 7.72% last season” sources said adding that recovery below 8 denoted poor sugar quality.

Similarly, the Tirupatthur unit which crushed 71,000 tonnes cane to produce 70,000 quintals sugar in 2014-15 was able to crush only 73,000 tonnes caneproducing 75,000 quintals sugar in 2018-19. “Sugar recovery which was 9.96% in 2014-15 slumped to less than one in the last season” officials added.

“The renovated Vellore mill has a sugar recovery ranging between 8.56% and 8.70% which helps us” Anandan said. What helps the mill is the co-generation plant which brings in profits. “TANGEDCO owes us Rs 10 crores and when we insist on payment, they say they are running up losses. But they continue to pay us as and when possible” he added.

In the other two mills, sugar production costs upto Rs 70 per kilo. As sugar is sold at Rs.32 per kilo, it results in a total loss. “But the Vellore mill ensures that sugar production costs only around Rs 38 a kilo” he adds.

However what worries Anandan is that registered cane area this season is only around 800 odd acres against the normal 3,100 acres, due to drought. “We plan to seek government help to ensure that nearly 1,000 acres unregistered cane is diverted to this mill, as the government is duty bound to help cooperative units which are owned by the common man” Anandan said and added that cane yield was expected to be around 40 tonnes per acre in the registered area.