- Why in news
- On 5 May 2026, the Cabinet Committee on Economic Affairs approved an FRP of Rs 365 per quintal for sugarcane for the 2026-27 sugar season, starting 1 October 2026.
- What it is
- The Fair and Remunerative Price is the minimum price sugar mills must pay farmers for sugarcane. The Centre fixes it each sugar season on the recommendation of the CACP, after consulting States. It is linked to a basic sugar recovery rate, with a premium or reduction as recovery changes.
- FRP level
- FRP for 2026-27 is Rs 365/qtl at a basic recovery rate of 10.25%.
- Who recommends
- FRP is set on CACP recommendations after consulting States and stakeholders.
- Season and applicability
- The sugar season runs October to September; the FRP applies to purchases by mills from 1 October 2026.
- Legal basis
- FRP is fixed under the Sugarcane (Control) Order, 1966, issued under the Essential Commodities Act, 1955; it replaced the Statutory Minimum Price in 2009-10.
Don’t confuse with FRP vs SAP: FRP is the Centre's minimum price. State Advised Price is set by some States, often higher.
Don’t confuse with FRP vs MSP: MSP applies to notified crops with government procurement support. FRP is a legally mandated price paid by mills, not procured by the government.
Economy terms and data: 42 Prelims questions since 2013, rising in recent years; they test what a term or instrument means. In Mains, 12 news-triggered questions.
Why it matters
- Assures remunerative income to about 5 crore cane farmers and supports 5 lakh mill workers.
- Links price to sugar recovery, encouraging better cane quality.
Problems
- Delayed cane dues: about 88.6% of 2025-26 dues were paid by 20 April 2026.
- Mills' viability is squeezed when FRP rises but sugar prices and ethanol returns lag.
- A high assured price encourages water-intensive sugarcane and sugar surpluses.
Way forward
- Ensure timely payment of dues, with monitoring and linkage to ethanol and sugar price policy.
- Promote crop diversification and water-efficient cultivation such as drip irrigation.
Put in your answer
Livelihood reach: The sugar sector affects about 5 crore farmers and dependents and 5 lakh mill workers.
- 2018Mains GS3 · Q3Define Minimum Support Price and how it rescues farmers from low income trap.
- 2017Mains GS3 · Q15Effect of subsidies and MSP on cropping pattern and farmers' economy.
- 2015Prelims Q13Which body approves the Fair and Remunerative Price of sugarcane?
- 2010Prelims Q147Whether Union fixes sugarcane statutory minimum price; sugar under Essential Commodities Act.
UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
Prelims practice · Statements
Ours, not from a UPSC paper
Consider the following statements:
- 1.The Fair and Remunerative Price of sugarcane is the minimum price that sugar mills must pay to farmers for sugarcane.
- 2.The Fair and Remunerative Price of sugarcane is fixed on the basis of recommendations of the Commission for Agricultural Costs and Prices, after consulting State Governments.
- 3.The Fair and Remunerative Price of Rs 365 per quintal approved for the 2026-27 sugar season is linked to a basic recovery rate of 9.5%.
Which of the statements given above is/are correct?
True or false?
1 of 5
Statements the way Prelims prints them. Say first, then see the fact.
1.The FRP of sugarcane for 2026-27 has been approved by the Cabinet Committee on Economic Affairs.
True. CCEA chaired by the Prime Minister approved it.
2.The FRP is fixed on the recommendation of the Commission for Agricultural Costs and Prices.
True. CACP recommends FRP, after consulting States.
3.The FRP for 2026-27 is about 2.81% higher than that for 2025-26.
True. The rise over 2025-26 is 2.81%.
4.The FRP for sugarcane is fixed under the Sugarcane (Control) Order, 1966, issued under the Essential Commodities Act, 1955.
True. The Sugarcane (Control) Order, 1966 under the Essential Commodities Act is the legal basis.
5.The FRP of sugarcane is the maximum price that sugar mills may pay to farmers.
False. FRP is the minimum price mills must pay; States may announce higher State Advised Prices.
Written by us from the release, not by UPSC; checked by a second model.
Mains practice
15 marks · 250 words
The Cabinet Committee on Economic Affairs has approved a Fair and Remunerative Price of Rs 365 per quintal for sugarcane for the 2026-27 sugar season. Examine the rationale and legal basis of the FRP mechanism, and discuss the challenges it poses for sugar mills, State finances and the sugar sector, suggesting a way forward.
Worth revising until Prelims 2027: most news questions come within two years of the event.