Sugarcane growers have finally received payment for their crops from Eastern Sugar Mills which had delayed paying them for a year. The farmers said the sugar factory owed them Rs310 million in total.

They had formed a struggle committee to pressure the factory to give the money owed to them after it held up payment. Eastern Sugar Mills began paying the farmers last week after they launched a protest.

Mill manager Suresh Prasad Mahato said the money owed to the farmers from last year had been deposited in their bank accounts. He added that the company had been unable to pay the farmers on time due to delays in obtaining a loan from the bank. Shivalal Chaudhary, president of the Koshi Sugarcane Producers’ Association, said Rs130 million out of the total money owed remained to be paid.

Meanwhile, Eastern Sugar Mills has pledged to sugarcane farmers on time in the future. As per Mahato, the factory management has signed an agreement in the presence of the chief district officer of Morang to pay farmers within 30 days of receiving their sugarcane harvests.

Chaudhary said that the delay in payment for last year’s sugarcane crops had discouraged farmers. “Due to this reason, many farmers have not planted sugarcane during this growing season while others have not been able to repay the loans they took from money lenders,” he said. Last year, Eastern Sugar Mills bought more than 82,000 tonnes of sugarcane worth Rs420 million from local farmers. However, the company issued payment amounting to only Rs110 million.

Meanwhile, the factory said that the delay in payment was also caused by low sugar yields from the sugarcane as the crop had been affected by disease. As per the company, sugar yields have dropped to 7 kg from 9 kg for every quintal of sugarcane. “In addition, a sharp fall in the market price of sugar last year affected the company’s revenue,” Mahato said. This year, Eastern Sugar Mills has planned to buy 120,000 tonnes of sugarcane from farmers. “We are committed to releasing the payment on time,” Mahato added. The company has been buying sugarcane from farmers in Sunsari, Morang and Jhapa districts.

Established two decades ago, the mill has a capacity to crush 3,000 tonnes of sugarcane daily. A shortage of raw materials has prevented the mill from operating at full capacity. According to the company, it has been receiving only 100,000-200,000 tonnes of sugarcane against its requirement of 300,000 tonnes annually.