"Till the time all cane is crushed, the state government will not allow processing of raw sugar by the mills in the state," Mayawati told a press conference here.
Her comments came a day after the Centre was compelled to relax the Excise Rules to enable UP mills to process imported raw sugar outside the state to rein in prices, which have gone up to almost Rs.50 a kg.
About 9 lakh tonnes of imported raw sugar is lying at different ports as the UP mills were not allowed by the state government to process the same.
Justifying her stand, Mayawati said the measure was taken in the larger interest of cane growers.
She alleged that the Centre was solely responsible for skyrocketing prices of sugar.
"The Centre did not create a buffer stock in 2006-07 and 2007-08 when the production was at its peak. Without assessing the requirement, it allowed exports at minimum prices. As a result, people are forced to buy sugar at prices three times higher," she said.
However, she said, officers have been directed to take stern action against hoarders and blackmarketeers.
Mayawati said she has taken steps like fixing the stock limit to check hoardings.
Agriculture Minister Sharad Pawar had yesterday blamed the Uttar Pradesh government for not heeding to its repeated requests to lift these restrictions on processing of imported raw sugar.
Mayawati said if last year's stock is taken into account, the country should have had adequate stock now.
In such a situation there was no justification behind the soaring prices, she said.
"The prices are soaring mainly because of the defective economic, import and export policies of the Centre," she said.
Mayawati said she had fixed the stock limit of sugar at 2000 quintals and turnover limit at 30 days in November last year.
In a reply to a question, Mayawati said her government will fully cooperate with the Centre in any endeavour to check price hike.
"In a federal set up there should be coordination between the states and the Centre. If the Centre takes any step in the interest of the common people, the states and chief ministers should cooperate," she said.