The government has increased the fair and remunerative price (FRP) of sugarcane by Rs 10 to Rs 365 per quintal for the 2026-27 season, which begins in October. The decision was approved by the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, according to a PTI report.
Key Highlights of the FRP Revision
Union Minister Ashwini Vaishnaw announced after the meeting that the FRP will be Rs 365 per quintal for a basic recovery rate of 10.25%. This revised price is 2.81% higher than the current rate of Rs 355 per quintal for the 2025-26 season.
For every 0.1% increase in sugar recovery above 10.25%, the FRP will rise by Rs 3.56 per quintal, providing an incentive for mills to achieve higher efficiency. To protect farmers supplying to mills with lower recovery rates, the government has decided that there will be no deduction in FRP for recovery below 9.5%. In such cases, farmers will receive Rs 338.3 per quintal in the 2026-27 season.
Economic Impact on Farmers
The production cost of sugarcane for 2026-27 has been estimated at Rs 182 per quintal, making the FRP 100.5% higher than the cost. Vaishnaw stated that farmers are expected to receive more than Rs 1 lakh crore from this revision. The move is expected to benefit nearly one crore sugarcane farmers, along with farm labourers and workers engaged in sugar mills.
The sugar sector supports the livelihoods of around five crore farmers and their families, and about five lakh workers directly employed in sugar mills, besides those involved in related activities such as transportation. Sugar mills are required to purchase sugarcane from farmers at the FRP or higher.
Ethanol Production and Cane Dues
Vaishnaw noted that the FRP has been increased every year over the past decade, and the latest revision will also support ethanol production from surplus sugarcane. On cane dues, he said that in the 2024-25 season, about Rs 1,02,209 crore, or nearly 99.5%, of the total payable dues of Rs 1,02,687 crore had been cleared as of April 20, 2026. For the ongoing 2025-26 season, Rs 99,961 crore, or 88.6%, has been paid out of total dues of Rs 1,12,740 crore.
The FRP has been fixed based on recommendations of the Commission for Agricultural Costs and Prices (CACP) and consultations with state governments and stakeholders. This ensures a fair price for farmers while maintaining the viability of the sugar industry.
