Sugarcane farmer Ashok Yadav of Rautahat used to plant the cash crop on 10 bighas till a few years ago, but now he does it on 1 bigha only.

The constant hassle of getting payment from the sugar mills for his harvest has made him disinclined to plant sugarcane, he says.

“I produce lentils, wheat and other vegetables on my farm now,” he said. “We don’t get much return from these crops, but at least we get cash unlike sugarcane which we always have to sell on credit.”

He said that Rautahat district used to produce 300,000 tonnes of sugarcane annually, but output has now shrunk to 50,000 tonnes.

In Mahottari, according to the Sugarcane Producers Farmers Association, five years ago there were 13,000 farmers who cultivated sugarcane, now there are only 7,000.

Naresh Kushawa, president of the association, says the sugarcane acreage has decreased from 15,000 bighas a few years ago to 7,000 bighas.

The statistics of the government too show that sugarcane production and acreage have become smaller in the last four years. Sugarcane production has been in continuous decline from 2017-18.

According to the Ministry of Agriculture and Livestock Development, Nepali farmers grew 3.67 million tonnes of sugarcane on 78,609 hectares in 2017-18. Output dropped sharply to 3.18 million tonnes and the acreage shrank to 64,354 hectares in 2020-21.

The ministry says that production has been declining due to the high cost and increasing market risk.

Sugarcane farmers say that difficulties in getting payment from the mills and chemical fertiliser from the government have discouraged them from planting the cash crop.

“Sugarcane farmers have to wait for months to get their money, and so most of them have switched to other crops,” said Kapil Muni Mainali, president of the Federation of Sugarcane Producers Association.

“There is a good return from sugarcane,” Kushawa said.

The government has been unable to set an appropriate price for sugarcane, and farmers say they are up to their necks in debt as a result.

"Farmers prefer to grow cash crops like hybrid paddy, mustard and maize," Mainali said. “Some farmers have dug big ponds on their farms to raise fish.”

The price of sugar has swelled by 30 percent this year, but the government has increased the price of sugarcane by a mere Rs20 per quintal. “The cost of growing sugarcane has increased by 30 percent,” said Mainali.

Rakesh Mishra, a farmer from Sarlahi, said the government never consults with the farmers before setting the minimum support price. Sugarcane farmers are unhappy with the latest rate.

The government on Wednesday raised the floor price of sugarcane by Rs20 per quintal to Rs610 per quintal for this year’s harvest.

Mishra complained that the government has set the price two months after the harvest season. "Even then the price is lower than the cost of production. It looks like the government does whatever businessmen say,” he said.

"The labour cost is up, there is a shortage of farm hands, there is a shortage of chemical fertiliser every year and the price of diesel is very high. Farmers have to buy fertiliser illegally. We have to pay Rs3,000 for a 50-kg bag when it used to cost around Rs1,500,” said Mishra.

"The cost of hiring a tractor to transport sugarcane to the mill is more than Rs3,000. It used to cost Rs1,200 two years ago. The government always promises to support farmers, but in the end the lofty promises remain unfulfilled, " said Nirmal Timilsina, a farmer from Bardibas-8, Mahottari.

Timilsina, who used to plant sugarcane on 10 bighas, has reduced the acreage by half as he doesn’t want to haggle over the price every year.

“I planted sugarcane by taking a loan, but the sugar mill is always delaying to make payment for my crop. Now, I have switched to mustard and vegetables.”

Prakash Kumar Sanjel, joint secretary of the Agriculture Ministry, says the government works as a mediator between sugar mills and sugarcane farmers while setting the minimum support price.

“The sugar mills say they will not be able to run the factory if they have to buy the cane at hiked rates. On the other hand, farmers say the rate does not cover even the cost of production,” he said.

“We conduct field reports in different districts before analysing the price. The minimum support price was set at Rs540 per quintal, adding the cost of production, profit and transportation. The government then provides farmers a subsidy of Rs70 per quintal so that both mills and farmers get a fair deal,” Sanjel said.

"The price is set after a joint agreement between sugar mill owners, farmers' representatives and the government," Sanjel said.

Decreased cultivation of sugarcane has led to an increase in the import of sugar.

According to the Agriculture Ministry, a Nepali is estimated to consume 4-6 kg of sugar annually. On the basis of consumption, the country’s sugar requirement stands at 260,000 tonnes annually.

Of the total sugar produced in the country, 65 percent is used by households and 35 percent is used for industrial purposes.

There are 13 sugar mills in Nepal and their annual production capacity is 463,950 tonnes. But since most of them are unable to operate at full capacity, domestic production fulfils only 71 percent of the requirement.

According to the ministry, sugarcane is a major cash crop in Nepal, but it faces obstacles in production and marketisation. There is a high possibility of producing quality sugarcane by expanding sugarcane farming commercially across the country. But there is no proper policy to promote the crop.