Lucknow: Low cane yield, diversion towards Khandsari units, and inadequate payment by many sugar mills to farmers have emerged as the three key reasons that stopped UP from becoming the country’s largest sugar producer in the 2025-26 crushing season.Official sources in the cane development department said UP’s production dipped from around 91 lakh metric tonnes (LMT) in 2024-25 to over 89 LMT in 2025-26, even as the current cane crushing season nears end. In UP, 121 mills took part in the season. Of them, 112 mills have already closed their operations.The sugar recovery in the state, though, registered an increase from 9.7% in 2024-25 to 10.2%, which was higher than Maharashtra.But in terms of sugar production, UP is way behind Maharashtra, where sugar production has gone up from around 81 LMT in 2024-25 to around 99 LMT this season, according to National Federation of Cooperative Sugar Factories (NFCSF) data. A total of 541 sugar mills in Maharashtra participated in the crushing season. Of them, 210 have completed their operations.UP losing the top spot in sugar production in the 2025-26 crushing season is significant since sugar carries both economic and political weight. The sector supports millions of cane farmers, thousands of workers, and is closely linked to rural cash flow in western and central UP.Uttar Pradesh faced a dip in sugar output for the 2025-26 season as sugarcane availability for crushing declined. Data show that cane that reached mills declined from 937.63 LMT to 874.51 LMT. The shortfall is attributed to an unusual rise in temperatures in Feb, followed by unseasonal rains in March.The situation worsened owing to crop damage due to rot in the widely grown Co-0238 sugarcane variety.In fact, several sugar mills shut operations earlier than scheduled. The Unn sugar mill in Shamli ceased crushing on the night of March 23-24, nearly 15 days ahead of its planned closure.Thana Bhawan sugar mill stopped operations in March end citing lower cane availability. Experts said farmers in parts of UP also switched to other crops, pushing down the cane acreage.Diversion of cane to Khandsari units, too, posed a severe challenge to the sugar mills this season. Industry sources said that against the SAP of Rs 400 per quintal (for early maturing variety), the Khandsari units have been doling out Rs 450 per quintal, prompting farmers to get quick compensation. Sources said that cane farmers often prioritise cash certainty over official pricing systems. Not surprisingly, if mills cannot compete on speed and rates, cane diversion will continue, experts said.Slow and inadequate payment by many sugar mills, too, is learnt to have contributed to less sugar production in the state. This is despite state govt cracking the whip on mills to ensure timely payment to farmers. The cane compensation in 2025-26 was around 90% of the total dues.
