**Executive Summary**
The Cabinet Committee on Economic Affairs has approved a Fair and Remunerative Price (FRP) of ₹365/qtl for sugarcane for the 2026-27 sugar season, effective from October 1, 2026. This decision aims to secure the interests of 5 crore farmers and 5 lakh workers by providing a price that is 100.5% higher than the estimated production cost. The new rate reflects a 2.81% increase over the previous season's FRP.
**Key Points / Main Content**
**FRP Pricing and Adjustments**
* **Basic Rate:** The FRP is fixed at ₹365/qtl for a basic recovery rate of 10.25%.
* **Premium for High Recovery:** A premium of ₹3.56/qtl is provided for every 0.1% increase in recovery above the 10.25% threshold.
* **Deduction for Lower Recovery:** The FRP will be reduced by ₹3.56/qtl for every 0.1% decrease in recovery below 10.25%.
* **Minimum Price Protection:** No deductions will be made for sugar mills where recovery is below 9.5%. Farmers at these mills are guaranteed a minimum price of ₹338.3/qtl.
**Financial and Statistical Context**
* **Production Cost:** The cost of production (A2 + FL) for the 2026-27 season is estimated at ₹182/qtl.
* **Comparative Growth:** The approved FRP of ₹365/qtl is 2.81% higher than the FRP for the 2025-26 season.
* **Payment Status:** For the 2024-25 season, 99.5% of cane dues (₹1,02,209 crore) have been cleared as of April 20, 2026. For the current 2025-26 season, 88.6% of dues (₹99,961 crore) have been paid.
**Policy Determination**
* The FRP was determined based on recommendations from the Commission for Agricultural Costs and Prices (CACP) and consultations with State Governments and other stakeholders.
**Impact Analysis**
**Sugarcane Farmers**
**Impact**
Farmers receive a remunerative price for their produce that is 100.5% above the cost of production, ensuring financial security for approximately 5 crore farmers and their dependents.
**Action Required**
Provide sugarcane to mills for the 2026-27 season starting October 1, 2026, to avail of the new pricing structure.
**Sugar Mills**
**Impact**
Mills are mandated to purchase sugarcane at the revised FRP, with pricing adjustments based on the 10.25% recovery rate and a protected floor price for low-recovery scenarios.
**Action Required**
Implement the approved FRP for all sugarcane purchases effective from the start of the 2026-27 sugar season (October 1, 2026).
**Sugar Mill and Ancillary Workers**
**Impact**
The decision supports the livelihoods of 5 lakh workers directly employed in sugar mills and many more in ancillary activities such as farm labor and transportation.
**Action Required**
No specific action is required; these stakeholders benefit from the continued stability and operation of the sugar sector.
Key Entities Referenced
Fair and Remunerative Price (FRP): The statutory minimum price determined by the government that sugar mills are legally required to pay to sugarcane farmers.
Cabinet Committee on Economic Affairs (CCEA): The apex government committee responsible for approving the pricing policy and economic decisions for the sugarcane sector.
Commission for Agricultural Costs and Prices (CACP): The advisory body that recommends the sugarcane price based on production costs and stakeholder consultations.
Cabinet Committee on Economic Affairs (CCEA)
Cabinet approves Fair and Remunerative Price of
Rs.365/qtl for Sugarcane Farmers for season
2026-27
Decision will benefit 5 crore sugarcane farmers as well as 5
lakh workers employed in the sugar mills and related ancillary
activities
Posted On: 05 MAY 2026 6:43PM by PIB Delhi
Keeping in view interest of sugarcane farmers (Ganna Kisan), the Cabinet Committee on Economic
Affairs chaired by the Prime Minister Shri Narendra Modi has approved Fair and Remunerative Price
(FRP) of sugarcane for Sugar Season 2026-27 (October - September) at Rs.365/qtl for a basic recovery
rate of 10.25%, providing a premium of Rs.3.56/qtl for each 0.1% increase in recovery over and above
10.25%, & reduction in FRP by Rs.3.56/qtl for each 0.1% decrease in recovery.
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.338.3/qtl
for sugarcane in ensuing sugar season 2026-27.
The cost of production (A2 +FL) of sugarcane for the Sugar Season 2026-27 is Rs.182/qtl. This FRP of
Rs.365/qtl at a recovery rate of 10.25% is higher by 100.5% over production cost. The FRP for Sugar
Season 2026-27 is 2.81% higher than current Sugar Season 2025-26.
The FRP approved shall be applicable for purchase of sugarcane from the farmers in the Sugar Season
2026-27 (starting w.e.f. 1st October, 2026) 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.Background:
The FRP has been determined on the basis of recommendations of Commission for Agricultural Costs and
Prices (CACP) and after consultation with State Governments and other stake-holders.
In the previous Sugar Season 2024-25, out of cane dues payable of Rs.1,02,687 crore about Rs.1,02,209
crore cane dues have been paid to farmers, as on 20.04.2026; thus, about 99.5% cane dues have been
cleared. In the current Sugar Season 2025-26, out of cane dues payable of Rs.1,12,740 crore about
Rs.99,961 crore cane dues have been paid to farmers, as on 20.04.2026; thus, about 88.6% cane dues have
been cleared.
***
MJPS
(Release ID: 2258113) Visitor Counter : 1574
Read this release in: Marathi , Telugu , Kannada , Assamese , Urdu , ही , Gujarati , Odia