NEPAL: Farmers go unpaid until government sets cane price

Published: 12/26/2016, 7:10:51 AM

Farmers in Kapilvastu are in big trouble as sugar mills are purchasing sugarcane on credit, stating that the government has yet to fix price of canes, according to Nepal's Republica newspaper.

They also say that the mills are buying canes from Indian farmers on cash. The mills are paying Indian farmers NPR512 (US$4.71) per quintal, but are giving only NPR492 per quintal to local farmers.

Shiva Pujan Yadav, a farmer from Bhalbari, said that the mills are buying canes on credit stating that the government was still to fix minimum support price of sugarcane. "We have no option but to sell our production on credit. We cannot let our canes dry up in field," Yadav added.

Another farmer from Bhalbari, Shiva Raj Chaudhari, said the decision of sugar mills has inflicted huge loss on them. "We have to buy inputs on cash. We have to pay laborers on cash. If we do not get payment in time, we will have to face huge loss," he added.

Indian government has fixed minimum support price of sugarcane at IRs 305. "Indian farmers also get lot of incentives and subsidies from the government," he added.

Jainullah Musalman of Jawabhari said he has no idea when the sugar mills will pay the farmers.

Jainullah had planted sugarcane in 30 bigaha of land. He is in big problem as he needs to repay loan.

Local farmers say they must invest NPR40,000-50,000 to plant sugarcane in one bigaha. Yields from one bigaha is only around 70-80 quintals.

Anup Chaudhari, president of Sugarcane Producers Association, said that mills owe around NPR20 billion to farmers 

According to the association, Nepali sugar mills import around 7,000 quintals of sugarcane daily from India on a daily basis during harvesting season.

Narayan Chaudhari of Mahalaxmi Sugar Mill said they cannot make payment to farmers before the minimum support price is fixed by the government. "We will start making payments once the government fixes the price, he said.