Value Chain Analysis of the Sugar Industry

The study undertakes a value chain analysis of the sugar industry in India with a focus on the industry in South Gujarat. CLRA has had a long engagement with sugarcane harvesting workers of South Gujarat. It has mapped the workers and documented their work conditions. The South Gujarat sugar factories are organized along the lines of the cooperative sugar factories of Maharashtra. A special feature of the pattern is that harvesting of sugarcane is managed by the Factory management. In North India, the farmers are responsible for bringing the produce to the factory gate.

The sugarcane harvesting workers are paid piece rate wages. The level of piece rate wages has been a matter of contention between the workers and the factory management. The workers have claimed that is very low and does not ensure a living wage for them. Any demand for wage hike has to be located in the context of the overall profitability of the industry. It was therefore decided to sponsor a value chain study of the sugar industry. This helps in knowing the industry profitability. This will lead to better articulation of demands by the workers.