The government has increased the minimum support price of sugarcane by 8.39 percent to Rs590 per quintal for this harvest season starting November.

According to government spokesperson Gyanendra Bahadur Karki, the Cabinet meeting on Wednesday approved the new rate.

Last year, the government had fixed the minimum support price of sugarcane at Rs544.33 per quintal.

Urmila KC, under secretary at Ministry of Industry, Commerce and Supplies, said the price includes a government subsidy of Rs70 per quintal paid to sugarcane farmers.

The floor price is the minimum price farmers get for their crops, and it is normally announced before the harvest on the basis of the recommendations of the Ministry of Agriculture and Livestock Development.

This year, it was delayed by two months. Farmers in key sugarcane producing areas criticised the government for the holdup as their standing crops were drying up in the fields.

“The minimum support price is fixed by calculating the cost of production, transportation cost and ensuring a certain profit for the farmers,” said KC. “The price has been recommended to the Industry Ministry after conducting a field study and also discussing the rate with sugarcane farmers and sugar mill owners.”

From 2018, the government started fixing the floor price of sugarcane in a bid to end constant confrontation between sugarcane farmers and sugar producers. It had become a tradition for sugarcane growers and sugar mills to engage in a bitter dispute over the floor price during harvest time every year.

Before the government began setting the floor price, sugarcane prices in Nepal were normally based on the rates paid by Indian mills to their farmers.

Sugarcane farmers said that the minimum support price should have been fixed in November and the crushing season should have started from December.

According to the Federation of Sugarcane Producers Association, output of sugarcane has plunged 50 percent as farmers face heavy losses following delays in payment for their crops and delays in the announcement of the minimum support price every year.

Sugarcane production has been declining continuously since 2012.