Basics · 1 Nov 2026

How is sugarcane price and payment calculated in India?

A mill must pay at least the FRP fixed by the Centre, adjusted for its recovery, or any higher price set by the state or agreed with the grower. For 2026-27 the FRP is Rs 365 per quintal at 10.25% recovery, and the bill is that rate multiplied by the recorded weight, less permitted deductions.

हिन्दी ಕನ್ನಡ मराठी

The price layers

Cane price in India is built in layers. The central layer applies everywhere. States then add to it in different ways.

FRP: the Fair and Remunerative Price fixed by the Centre under clause 3(1) of the Sugarcane (Control) Order, 1966. No mill may buy below it (clause 3(2)).
SAP: the State Advised Price. The Supreme Court held in 2020 that a state may fix a price higher than the central price, and that the two do not conflict.
Revenue sharing: a further price worked out after the season from sugar and by-product value, used in states such as Tamil Nadu and Maharashtra.
Agreed price: clause 3(3) also recognises a rate agreed between the mill and the grower.

FRP for 2026-27

The CCEA approved the 2026-27 FRP on 5 May 2026. It applies to cane bought from 1 October 2026. The base is Rs 365 per quintal, or Rs 3,650 per tonne, at 10.25% recovery.

The rate moves by Rs 3.56 per quintal for each 0.1% of recovery above or below the base. There is no further reduction once recovery falls below 9.5%, so the floor is Rs 338.30 per quintal. For comparison, 2025-26 was Rs 355 at the same base.

Mill recovery	Working	FRP per quintal (Rs)
9.50% or below	Floor	338.30
9.85%	365 less 4 steps	350.76
10.25%	Base	365.00
10.75%	365 plus 5 steps	382.80
11.25%	365 plus 10 steps	400.60

Which recovery figure applies

FRP is tied to a mill's recovery, and final recovery for the running season is known only after crushing ends. In the 2025 Raju Shetti case, the Bombay High Court said the clause 3(1) FRP rests on the prior season. The record in that case describes mill-wise FRP based on previous season recovery.

The court quashed Maharashtra's February 2022 resolution, which split FRP into two instalments. It also said any final price for the season is a separate exercise done after FRP is paid. We could not confirm whether an appeal is pending, so check the current position with your counsel.

From rate to bill

The cane bill follows the same steps in most mills. Payment is on recorded weight in Maharashtra, Karnataka, Tamil Nadu and Uttar Pradesh, though rounding rules differ. Karnataka and Tamil Nadu round the price to the nearest rupee.

Take the net cane weight from the weighment.
Apply the rate for the season, recovery and any variety rule.
Remove rebates allowed by the authorities under clause 3A, such as transport from a purchase centre.
Remove deductions the law permits, such as society dues.
Pay the balance within 14 days of delivery.

Worked example

A grower delivers 25 tonnes (250 quintals) to a mill with 10.75% recovery in 2026-27. The FRP value is 250 x Rs 382.80, or Rs 95,700. Permitted deductions then come off this figure. This example ignores any SAP, H&T or rebate.

Where states differ

Rates change by notification. The figures below were the latest we could verify on 1 November 2026.

State	How price works	Latest figure verified
Uttar Pradesh	SAP by variety. Mills generally do not run harvest and transport.	2025-26: Rs 400 early, Rs 390 common. No 2026-27 SAP found.
Haryana	SAP.	2026-27: Rs 430 per quintal, reported 30 October 2026. Check the notification.
Maharashtra	FRP, with H&T done by the factory and deducted. Further price under the 2013 Act.	FRP as above.
Karnataka	FRP, plus a state order on additional price in 2025-26.	2025-26: reported at Rs 3,300 a tonne at 11.25% recovery. Reports differ on H&T and mills challenged the order.
Tamil Nadu	Revenue share is the higher of 70% of sugar and by-product value or 75% of sugar value. The 2018 Act puts transport cost on the factory, above FRP, subject to review.	FRP as above.

Before the first bill of the season

This is general information. Confirm figures against the current notification and with your accountant. SugarOS holds FRP, SAP and revenue sharing as dated, approved rules, and the mill enters the rates.

Read the gazette notification, not only the press note.
Confirm the recovery figure your state accepts for the running season.
Confirm the H&T treatment and who approved the rate.
Record each rate with its effective date and approver.
Have your accountant review the rounding rule and the deduction order.

Frequently asked questions

Is FRP the price at the farm or at the factory gate?

The Order defines price for cane delivered at the factory gate or a purchasing centre. In Maharashtra, factories arrange harvest and transport for growers and deduct the cost from FRP, as the Bombay High Court record describes. Tamil Nadu's 2018 Act treats transport differently. Check your state rule.

What happens if a mill's recovery is below 9.5%?

The reduction stops. For 2026-27 growers supplying such mills get Rs 338.30 per quintal, according to the PIB release of 5 May 2026.

Can a state fix a price below FRP?

No. In West UP Sugar Mills Association (2020), the Supreme Court said the central price prevails where a state price is lower. A state price above it stands.

Has the 1966 Order been replaced?

A draft Sugarcane (Control) Order, 2026 was circulated in April 2026 and withdrawn in late May 2026 for review. We found no replacement in force on 1 November 2026, so check for later notifications.

Sources

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