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State-Owned Pabna Sugar Mill, which has yet to see profits since its establishment in the mid-90s, started this season’s production last month with a debt of Tk 575 crore.
Sugarcane cultivation centring the mill in Dashuria in Pabna’s Ishwardi upazila alongside the mill’s production decreased at least 50 percent in the past decade, say sources.
Farmers say they cut back for alleged inadequate support from the mill, delays in payment and corruption. The mill authorities refute these, instead saying that curbing losses required product diversification.
This year the management plans to process 82,000 tonnes of sugarcane. They expect the recovery rate to be no more than 8 percent, meaning 6,560 tonnes of sugar will be produced.
“We targeted running the mill for 60 to 65 days if sugarcane is available,” the mill’s managing director, Md Abdus Selim, told The Daily Star.
The mill’s daily crushing capacity is some 1,500 tonnes, meaning in 100 days about 15,000 tonnes of sugar can be produced, he said.
The Bangladesh Sugar and Food Industries Corporation’s annual report for fiscal 2017-18, which was published in the mid-October last year, states that the country’s 15 state-run sugar mills crushed 11,88,573 tonnes of sugarcane.
This generated 68,562.50 tonnes of sugar, which meant that the recovery rate was 5.77 percent. However, their production capacity is 210,440 tonnes.
In May last year, the US Department of Agriculture estimated Bangladesh’s sugar consumption at 26.95 lakh tonnes in fiscal 2017-18.
This means the deficit was met through imports. According to the Bangladesh Bureau of Statistics, the import of raw sugar rose 20 percent year-on-year to 26.15 lakh tonnes in fiscal 2017-18.
On the lack of support and delayed payments, one farmer spoke of being forced to opt for cultivating other crops.
“A few years ago I used to cultivate sugarcane on 30 to 32 bighas (around 12 acres) of land every year for supplying to Pabna Sugar Mill,” said Md Azmal Hossain of Varuimari village.
He cultivated sugarcane on just five bighas or two acres of land this year and used the rest of his land to produce cauliflower. “We often did not get paid on time. If we faced any trouble in production such as a crisis of seed and fertiliser, the mill authority provided no support. So we incurred a huge amount of losses every year,” he said.
Farmer Md Rafikul Islam of Dashuria pointed out that sugarcane cultivation occupied the lands for up to 12 to 16 months, whereas three harvests can be made if any other crop was farmed.
He also alleged that payments were delayed by as much as a year while the mill authorities accepted bribes to give priority when dues were cleared.
Md Sajahan Ali Badsha, secretary to Bangladesh Akh-Chashi Federation, a platform of sugarcane farmers, said at least 1.5 lakh to 2 lakh tonnes of sugarcane used to be available in the areas surrounding the mill a decade ago.
Now it is no more 80,000 to 1 lakh tonne, he said, adding that farmers mostly opted for cultivating vegetables and other crops.
Acknowledging that payments had to be delayed as yearly government allocations did not reach them on time, the managing director said this time around they were trying to clear dues as soon as possible. “We are buying each maund (around 37 kilogrammes) of sugarcane for Tk 75 this year,” he said.
On support, he claimed to have provided it to the best of his abilities. On the bribe allegation, he said there might have been some scattered incidents.
“Unfortunately sugarcane has not been sufficiently available in the last couple of years. Farmers went for cultivating other crops to increase their profits,” he added.
On calculating costs pertaining to infrastructure maintenance, workers’ salaries etc, production cost of one kilogramme of sugar comes to stand at Tk 149 but it is being sold at Tk 50, he said explaining the piling up of losses.
Basically, the rule of thumb is that the production amount is inversely proportional to production cost.
He suggested product diversification for alternative sources of income, such as producing liquor and using bagasse or the fibre remaining after juice extraction from sugarcane as animal feed, to generate electricity and produce cardboard, acoustic tile, paper etc.
“The government has long kept on hold for many years a project on increasing production using by-products in five mills.”
(TDS)