As per Business Standard report, Uttar Pradesh's sugar industry has significantly evolved in the last 8 years, transitioning from conventional sugar production to integrated complexes.
This transformation has contributed to rural development, renewable energy, and national economic progress.
In the 2024-25 sugar season, Uttar Pradesh cultivated sugarcane on 29,50,000 hectares, producing 24,94,20,000 tonnes with an average yield of 8.32 tonnes per hectare.
The state's 122 sugar mills crushed 9,55,00,000 tonnes of sugarcane, yielding 9.25 million tonnes of sugar with a recovery rate of 9.67% using B-heavy molasses.
The industry produced 4.87 million tonnes of molasses and 1.80 billion litres of ethanol in 2024-25, significantly contributing to India's ethanol blending programme.
Additionally, the sector generated 2,912 million units of cogeneration power, with an installed capacity exceeding 2,000 MW.
In a notable move, the Uttar Pradesh government recently announced a ₹30 per quintal increase in the State Advised Price (SAP) for sugarcane for the 2025-26 season. This adjustment raises the procurement price to ₹400 per quintal for early maturing varieties, while common varieties will see an increase from ₹360 to ₹390 per quintal.
This hike is one of the sharpest in recent years, with the last significant increase occurring in the 2021-22 season. At that time, the SAP for common varieties rose from ₹315 to ₹340 per quintal, and for early maturing varieties, it was ₹350 per quintal.
The sugarcane sector in Uttar Pradesh directly involves 4.5 million farmer households, making it a vital component of the state's economy.
The timely and full payment of sugarcane dues has been a major achievement, with annual cane payments exceeding ₹35,000 crore. This financial stability is crucial for the livelihood of these households.
The recent SAP increase is significant when compared to previous adjustments. In the 2021-22 season, the SAP for common varieties was ₹340 per quintal, while early maturing varieties were priced at ₹350 per quintal.
The current increase to ₹390 and ₹400 per quintal, respectively, marks a substantial rise, reflecting the government's commitment to supporting the sugarcane industry.
The sugar industry is exploring new growth avenues such as compressed biogas (CBG) production, leveraging abundant organic residues.
CBG plants provide an additional income source and support clean mobility. The state and central governments offer incentives for setting up CBG plants under the SATAT scheme.
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Uttar Pradesh's sugar sector is actively involved in healthcare, education, sanitation, and women empowerment projects.
The industry supports over 10,00,000 livelihoods, including farmers, transporters, vendors, and workers, driving economic activity and improving living standards in rural areas.
The sugar industry has been pivotal in India's ethanol blending programme, aligning with the target of 20% blending by 2025.
By supplying around 1.80 billion litres of ethanol in 2024-25 to oil marketing companies (OMCs), the industry is set to save approximately ₹8,000 crore in foreign exchange annually.
Significant co-generation projects using bagasse have been established, producing over 2,000 MW of green electricity.
Many projects are registered under the Clean Development Mechanism (CDM), earning carbon credits while supplying around 3,000 million units of green energy annually.
The production of compressed biogas (CBG) offers a new business opportunity for millers. With abundant feedstock like press mud and filter cake, CBG plants provide a steady raw material source. This initiative supports clean mobility and reduces methane emissions.
The industry is progressing in producing sustainable aviation fuel (SAF) by integrating alcohol-to-jet (ATJ) technologies. With a growing global demand for low-carbon value chains, SAF production aligns with regulatory mandates for increased SAF blending.
Sugar mills are developing decentralised hydrogen hubs, acting as rural green hydrogen production clusters.
These hubs support uses like boilers and mobility, while also dispensing ethanol (E100/E20) within mill premises, promoting clean mobility and bypassing intermediaries.
Uttar Pradesh's sugar industry has expanded beyond traditional sugar production, embracing diversification into ethanol, power, and bio-fertilisers. This transformation has not only boosted the state's economy but also contributed to rural development and renewable energy initiatives.
Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: Jan 5, 2026, 4:11 PM IST
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