Uttar Pradesh raises cane floor price

India's biggest cane producing state Uttar Pradesh has raised the price sugar mills must pay for the new season crop by as much as 19 per cent to 235-250 rupees per 100 kg, chief minister of the state said on Tuesday.

In 2010-11, the state government asked mills to pay 205-210 rupees per 100 kg for different varieties of cane.

Higher prices will encourage farmers to plant more, potentially increasing output for the world's biggest producer behind Brazil and making exports easier.

The federal government has set the 201112 cane floor price at Rs145/100kg. States governments are entitled to increase the price fixed by the federal government.

Uttar Pradesh, which roughly accounts for about a quarter of India's total sugar output, has raised the price to woo cane farmers, a large constituency, ahead of state elections due in May.

India produced 24.3 million tonnes of sugar in 2010-11.

(Reporting by Alka Pande; writing by Mayank Bhardwaj; Editing by Harish Nambiar)