KATHMANDU, Feb 6: Sugar mills have raised the factory price of sugar by Rs 2 per kg, arguing that the government recently revised the floor price of sugarcane for the farmers.
Sugar producers who more often than not delay the payments to be made to the sugarcane farmers have increased the price of their finished products, leaving the consumers at the receiving end. After the revised price, the factory price of sugar now stands at Rs 70 per kg excluding the value added tax (VAT), according to Nepal Sugar Producers Association.
Shashi Kant Agrawal, president of the association, however said that they were compelled to increase the price of sugar due to a surge in production costs triggered by the impacts of the COVID-19 pandemic. “In addition, an increase in the cost of the raw material has put extra financial burden on the sugar mills,” Agrawal said.
With the commencement of the main crushing season of sugarcane that started in November, the government this year increased the minimum support price of the agro product to Rs 543 per quintal, a hike by Rs 8 per quintal. The government authorities increased the minimum support price for farmers in the past two years.
The step of the sugar mills is likely to increase the sugar price by a minimum of Rs 10 per kg, said the retailers. According to them, the players involved in market transactions are also likely to increase their profit margins once the factory price is increased.