International Sugar Journal

A paradox of increasing cane price paid by sugar factories in India resulting in the decrease of cane supplied in the following years [Full subscriber]

The present study attempts to reveal the paradox faced by sugar factories in Andhra Pradesh receiving reduced cane supply following an increase in payment to growers for their cane in the previous year. The secondary data collected for the period 1990-91 to 2009-10 were on variables like jaggery prices, sugarcane prices, sugar prices, sugarcane crushed and sugarcane acreage for factories under study. Cobb-Douglas type of production function, Multiple Linear Regression (MLR) and Marginal Value of Productivity (MVP) were employed. The paradoxical situation arises for the following reason. An increase in price by 1% to cane growers by sugar factories results…

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