Value Chain Analysis of Sugarcane-based Products in Meerut District of Uttar Pradesh

Abstract

Sugarcane (Saccharum officinarum Linn.) is one of India's most widely planted crop, it is a coarse grass which is quite tall about 10 to 20 feet and belongs to the family (Poaceae).It is an important cash crop of India and used as raw material in the preparation of sugar and jaggery. During 2022-23, the area under sugarcane cultivation in India was 58.83 Lakh hectares with the production of 494.22 million tonnes and yield of 84.01 tonnes/ha (Source: https://sugarcane.dac.gov.in/pdf/StatisticsAPY.pdf). The present study on ‘Value chain analysis of sugarcane-based products in Meerut district of Uttar Pradesh’ was carried out in the year 2023-24 with objectives to find out cost and returns from sugarcane-based products, break even analysis ,to identify marketing channels, price spread and marketing efficiency in various channels. Among 12 blocks of the district, Daurala block having highest no. of jaggery and khandsari processors was selected. The study used both primary and secondary data. A total of 52 sample respondents consisted of 12 sugarcane crushers and 30 market intermediaries and 10 consumers were interviewed personally to collect primary data. It was observed that of average cost of production of jaggery was Rs.3437.23 per quintal and for khandsari, average cost of production was Rs.5198.66 per quintal. Gross returns from jaggery production were Rs.3996 per quintal and from khandsari production, gross returns were Rs.5720 per quintal. The net return per quintal from jaggery production were Rs.558.77 and net returns from khandsari production were Rs.521.34 per quintal. The benefit-cost ratio observed to be highest for Jaggery producers (1:1.16) compared to khandsari producers (1:1.10). The average B: C ratio was 1.16 indicates Rs.1.16 returns per net rupee invested and B: C ratio of 1:1.10 indicates Rs.1.10 returns per rupee invested. The break even output for Jaggery production was found to be 313.85 Qtl. Per unit and for khandsari it was found to be 390.40 Qtl. Per unit indicating that these crushing units were operating in profit zone and can continue in the business. Two marketing channels have been identified for jiggery and khandsari in the study area. Channel I (Producer → Commission agent → Wholesaler → Retailer → Consumer) and Channel II (Producer → Commission agent → Retailer → Consumer). Channel II was found efficient for both jaggery and khandsari with lowest price spread of Rs. 550 and highest marketing efficiency of 7.09% for jaggery and lowest price spread of Rs.550 and highest marketing efficiency of 9.45% for khandsari due to a smaller number of intermediaries and marketing cost was minimum in channel II for both the produce. Lack of skilled labour, non-availability of suitable sugarcane varieties , irregular demand of produce, high initial cost of establishment, inadequate electric supply, no price incentives were the major constraints faced by crushers in production of jaggery and khandsari, whereas market holidays, fluctuations in prices of jaggery and khandsari, lack of grading facility, lack of storage facility, delay in payments, defective and faulty weighing were the major problems identified in marketing of jaggery and khandsari. The market intermediaries expressed that lack of scientific storage facility, long distance from market, high transportation and handling charges, inadequate availability of quality product, fluctuating demand seasonal product were the major problems faced by them.