UP opens Rs.500 crore revenue stream for beleaguered sugar mills

The Uttar Pradesh government has opened an additional revenue stream of more than Rs 500 crore annually for pharma grade sugar mills by deciding to fix floor price of molasses sold to distillers under the levy scheme.

Molasses, a sugarcane byproduct, is extracted during the process of refined sugar production and is used by distillers in the manufacturing of country liquor. Under levy, UP sugar mills are obligated to supply 12.5 per cent of their molasses stock to distillers/country liquor manufacturers.
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“The state sugar mills will get additional revenue of Rs 500 crore based on the floor price of molasses. It could even be higher, if distillers bid at a higher price for their levy,” he said. Last year, the UP mills had even urged the state government to de-control the sale of molasses to allow the sugar ip companies to capitalise on ethanol price hike by the Centre.

Source: ISMA