June 12, 2018 03:00 AM NPT
KATHMANDU, June 12: Sugar price is expected to go down in the domestic market as its price is falling in neighboring India, officials of Nepal Retailers Association (NRA) say.
Although the government has imposed 15 percent customs duty on sugar, retailers say it won't be sufficient to stop import of sugar from international market which has seen significant drop in prices in recent months.
Increasing sugar imports, at a time when domestic sugar producers are not finding markets for their products, has worried both farmers and sugar mills.
Traders are importing sugar from countries like India and Bangladesh, among others, as price there is lower compared to price fixed by domestic sugar mills, officials of NRA say. “Sugar price is higher in Nepal compared to other countries. That is why traders are importing sugar in high volumes,” Pabitra Bajracharya, president of NRA.
According to a report published by newswire Reuters last week, sugar prices in India have dropped to their lowest in 28 months, exacerbating financial woes of sugar mills and exacerbating financial woes of sugar mills. “India is set to announce support measures to cut a growing sugar surplus and prop up local prices aiming at helping loss-making mills and millions of cane growers who make up a key voting bloc,” the agency reported.
Currently, sugar is retailing in India at around IRs 29 per kg, according to Bajracharya.
The government has fixed the price of sugar at Rs 66 per kg. As the price is much higher compared to import costs, traders are importing this popular commodity from international markets, Bajracharya told Republica.
Kapil Muni Mainali, president of Nepal Sugarcane Producers Association (NSPA), said that the government was being indifferent toward the problem that farmers and sugar mills are facing. “At at time when locally produced sugar is not finding market, traders are openly importing sugar from international markets. Sugar is readily available at around IRs 30 per kg in border towns,” he said. “As sugar mills are not being able to sell their products, thousands of farmers across the country are not receiving payments from these mills.”
He also said that the budget for Fiscal Year 2018/19 has failed to address the issue.
The government has fixed minimum support price of sugarcane at Rs 536.56 per quintal this year.
Nepal produced 170,000 tons of sugarcane this year, up from 130,000 tons compared to a year earlier. According to Mainali, sugar yields from sugarcane produced in Nepal are lower compared to India.