Sugar factories in the State are finding themselves in a tight spot, with piling stocks of molasses on one hand and the government refusing to accord permission for its export on the other hand.

Unable to stock the molasses, which is their major by-product, most sugar factories are dumping it in the pits in their vicinity. This has led to environmental pollution, with the result that the Karnataka State Pollution Control Board (KSPCB) has issued notice to the sugar factories.

Apart from environmental hazard, the price of molasses has hit rock bottom low this year. A tonne of molasses, which was sold at Rs 4,000-Rs 5,000 last year and the year before that, is being sold at a paltry amount of Rs 200 to Rs 250 per tonne. The irony is that even for this price, there are no buyers in the State and the factories are forced to pay Excise duty of Rs 750 for per tonne of molasses produced.

At present there are 16 cooperative and 29 private sugar factories in Karnataka. Due to bumper sugarcane production during 2006-07, most sugar factories exceeded their targets of production. Consequently the production of molasses, which used to be 8-9 lakh tonnes previously, crossed over 11 lakh tonnes this year. Usually if a lakh metric tonne of sugar cane is crushed, it will result in a production of 4,000- 4,500 tonnes of molasses.

Mr Ishwar Khandre, chairman of Bidar Sahakar Sakkare Karkhane, one of the oldest cooperative sugar factories in the State, blamed “bureaucratic red-tapism” for the problem faced by the sugar factories.
“We have met the chief minister, deputy chief minister and the sugar minister but there has been no relief from the government so far. They are not allowing us to export molasses. Our tank has a storage capacity of 12,000 tonnes and we are unable to stock excess quantity.We have no option but to dump it in the pits,” said Mr Khandre.

A representative of the Karnataka State Federation of Co-operative Sugar Factories Limited said that the inter-state trading is banned in molasses, giving permission for export as the only alternative. “Usually the factories are given permits for selling specified quantity to distilleries. But unlike in previous years, this year there is a delay on the part of distilleries to lift the molasses. As a result 13 cooperative sugar factories have a combined stock of 1.13 lakh tonnes as on July 31, 2007”, the representative informed.

Meanwhile a senior excise officer said that they have given permit for exporting 4.25 lakh tonnes of molasses recently. He added that the demand for molasses has come down even in the international market.


FACT FLOW
* Over 11 lakh tonnes of molasses production in State in 2007
* Unable to stock, most sugar factories release molasses in pits
* State Pollution Control Board issues notice to sugar factories
* Govt gives nod for export of 4.5 lakh tonnes of molasses