Ministry told to fix floor price of sugarcane

- POST REPORT, Kathmandu
Ministry told to fix floor price of sugarcane

Feb 26, 2015-

The Cabinet on Thursday directed the Ministry of Industry to set the minimum support price of sugarcane even as demonstrations by farmers raged across the Tarai.

Last week, hundreds of sugarcane growers staged a protest on the East-West Highway at Hariban, Sarlahi demanding that the government set the floor price for their products reflecting the rising production costs. Farmers have threatened to hold violent demonstrations if their demand are not met.  

It has been a tradition for sugarcane growers and sugar mills to engage in a bitter confrontation over the floor price during harvest time. The government does not set sugarcane prices, and factories and farmers are told to sort things out themselves, and this provision leads to tensions flaring up every year.

The cane price is normally determined in Nepal based on the price offered by Indian mills to their farmers.

“We have not received any formal directive from the Cabinet,” said Uttam Bhattarai, secretary at the Industry Ministry. “However, we are in favour of settling the longstanding issue between sugar mills and sugarcane producers with a win-win deal,” Bhattarai said. He added that the ministry was awaiting the written directive and would act accordingly after receiving it.

The matter was bucked up to the Prime Minister’s Office after growing disputes between the farmers and sugar mills. Sugarcane farmers said the crushing of sugarcane had started two months ago, but there was no sign of determining the new rate for this season. Although farmers have demanded a hike in the rates in line with increased production costs, sugar producers have been ignoring their demand. This year, farmers are asking for Rs 525 per quintal for their sugarcane. Last year, the rate was Rs 476 per quintal.

While sugarcane producers have been demanding a price hike, sugar producers said that they were unable to pay what the farmers were demanding. They said that the price of sugarcane should be reduced as sugar prices had fallen this year.

Likewise, sugarcane growers in Parsa had submitted a four-point memorandum to Prime Minister Sushil Koirala through the chief district officer recently demanding that the problem be resolved at the earliest.

In Sarlahi, five associations of sugarcane growers-Nepal Sugarcane Producers Association, District Sugarcane Producers Association, Sugarcane Producers Farmers Development Society and Sugarcane Farmers Welfare Committee-have joined forces to strengthen their agitation against the government and the mills. On January 3, 2011, the local administration was forced to impose a daylong curfew on either side of the East-West Highway up to 13 km in Sarlahi district following a strike organized by farmers demanding that cane prices be fixed. At least 40 police personnel were injured in clashes with the irate farmers.

Nepal produced 2.93 million tonnes of sugarcane in 2012, up from 2.71 million tonnes in 2011. The area under sugarcane farming has increased to 64,472 hectares in 2012 from 62,998 hectares in 2011, according to official statistics.

Published: 27-02-2015 08:56

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