CM Fadnavis: Centre positive on sugar, ethanol, onion issues
Synopsis
A high-level meeting in New Delhi chaired by Union Minister Amit Shah, attended by CM Devendra Fadnavis, produced positive signals on raising sugar MSP, expanding the ethanol quota, shifting onion procurement directly to farmers, and imposing an export surcharge on onion seeds — with central decisions expected within two months.
Key Takeaways
Union Minister Amit Shah acknowledged the need to raise the minimum support price for sugar and agreed to a decision on ethanol quota expansion within two months .
NAFED and NCCF will shift onion procurement directly from farmers instead of traders; target may rise from 2 lakh tonnes to 10 lakh tonnes .
An export surcharge on onion seeds will be imposed to protect the domestic onion export market; there is no ban on onion exports themselves.
Machine-based grading will replace manual grading at NAFED and NCCF procurement centres to prevent arbitrary rejection of farmer produce.
The onion procurement price was recently raised to ₹15.80 per kg , with discussions on further increases held at the meeting.
Union Agriculture Minister Shivraj Singh Chouhan committed to convening a meeting with insurance companies to ease conditions for Alphonso mango growers.
The Chief Minister's Office of Maharashtra announced on Wednesday, 27 May 2026 that a high-level meeting chaired by Union Home and Cooperation Minister Amit Shah in New Delhi produced positive signals on long-standing demands of sugarcane and onion farmers in the state. Chief Minister Devendra Fadnavis, who attended the meeting alongside Union Ministers Shivraj Singh Chouhan and Pralhad Joshi, said the central government is expected to announce favourable decisions shortly.
What was discussed
The meeting covered a wide range of farmer concerns: revision of the minimum support price (MSP) for sugar, expansion of the ethanol quota, loan restructuring, interest subvention, direct procurement of onions from farmers, machine-based grading of farm produce, and an export surcharge on onion seeds. CM Fadnavis described the discussions as 'positive' and said the centre had agreed in principle on most of the demands raised by the Maharashtra government.
Fadnavis stated that Union Minister Shah acknowledged the need to raise the minimum support price for sugar. On ethanol, Shah agreed that a decision on a 'significant increase' in the ethanol quota would be taken within two months. The centre also assured that interest subvention funds would be released immediately, and that it would work jointly with the state government on loan restructuring for sugar mills.
Context
Maharashtra is India's largest sugarcane-producing state and a dominant force in onion cultivation, particularly in the Nashik belt. Farmers in both sectors have faced recurring distress — sugar mills have accumulated arrears on cane payments, while onion growers have repeatedly suffered from price crashes triggered by export restrictions and import decisions. The meeting reflects the state government's sustained effort to secure central relief for two of its most politically sensitive farm constituencies.
The central government has periodically revised the Fair and Remunerative Price (FRP) for sugarcane, with multiple upward revisions since 2013-14. The Ethanol Blended Petrol Programme has been a key policy instrument linking sugarcane surplus to biofuel production, with blending targets raised progressively to a 20 percent goal. Interest subvention on crop loans has operated as a continuing central scheme since 2006-07.
Onion procurement and grading reforms
NAFED (National Agricultural Cooperative Marketing Federation) and NCCF (National Cooperative Consumers Federation) currently procure onions primarily from traders. The Maharashtra government's demand — that procurement be made directly from farmers — was accepted at the meeting. Fadnavis also said a positive decision is expected on raising NAFED and NCCF's onion procurement target from 2 lakh tonnes to 10 lakh tonnes.
On the issue of onion seeds, Fadnavis noted that large-scale export of onion seeds was squeezing the domestic onion export market. The demand to impose a substantial export surcharge on onion seeds was accepted. He clarified that while restrictions are being placed on onion seed exports, there is no ban on onion exports themselves. The procurement price for onions was recently revised upward to ₹15.80 per kg, and discussions on further increases took place at the meeting.
A persistent complaint from farmers has been that NAFED and NCCF officials reject produce by classifying it as sub-standard during grading. The meeting agreed that machine-based grading will now be introduced to ensure fair and objective assessment, removing scope for arbitrary rejection.
Mango and crop insurance
A separate representation on Alphonso mango growers' concerns was submitted to Union Agriculture Minister Shivraj Singh Chouhan during the meeting. Fadnavis said it was brought to Chouhan's notice that relaxing restrictive conditions imposed by insurance companies could provide significant relief to mango farmers. Chouhan assured that he would convene a meeting with insurance companies to find a solution.
What's next
Deputy Chief Ministers Eknath Shinde and Sunetra Ajit Pawar, along with several Maharashtra cabinet ministers, were present at the meeting. The state government is expected to submit a formal proposal on 'queue pricing' (price regulation mechanism for sugar) to the centre shortly, which Fadnavis said could resolve several structural issues in the sugar industry. The key watch-points are the central government's formal decisions on FRP revision, ethanol quota expansion, and revised crop insurance norms — all expected within the next two months.
Point of View
If implemented, would mark a structural change in how price-support operations work, reducing the role of intermediary traders. The two-month timeline for ethanol quota decisions will be a credible test of whether this high-level meeting translates into on-ground relief for Maharashtra's cooperative sugar sector.
NationPress
12 Jul 2026
Frequently Asked Questions
What was decided at the Amit Shah meeting on Maharashtra farmers in May 2026?
The meeting, chaired by Union Minister Amit Shah in New Delhi on 27 May 2026, produced positive outcomes including agreement on raising sugar MSP, expanding the ethanol quota within two months, direct onion procurement from farmers by NAFED and NCCF, an export surcharge on onion seeds, machine-based grading, and immediate release of interest subvention funds.
Will NAFED buy onions directly from farmers in Maharashtra?
Yes. The Maharashtra government's demand that NAFED and NCCF purchase onions directly from farmers — rather than through traders — was accepted at the 27 May 2026 meeting. The procurement target may also be raised from 2 lakh tonnes to 10 lakh tonnes.
What is the current onion procurement price and will it increase?
The onion procurement price was recently revised to ₹15.80 per kg. CM Devendra Fadnavis said discussions on how to increase it further were held at the New Delhi meeting, though a specific new figure has not yet been announced.
What is the ethanol quota and why does it matter for sugarcane farmers?
The ethanol quota determines how much ethanol sugar mills can produce and supply under the Ethanol Blended Petrol Programme. A higher quota allows mills to convert more cane juice or molasses into ethanol, improving their cash flow and ability to pay farmers on time. The centre agreed to decide on a significant quota increase within two months.
Why is an export surcharge being placed on onion seeds?
Large-scale export of onion seeds was found to be reducing the availability of seed for domestic cultivation, which in turn limits India's onion output and its capacity to export onions. Imposing an export surcharge on onion seeds is intended to protect the domestic supply chain and onion export market.
