Bangladesh Defense
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Govt should act to save cane farming, sugar mills
THIS is a matter of concern that whilst the closure of six of the 15 state-owned sugar mills and some expense reduction steps have failed to make the remaining ventures profitable, farmers appear gradually to be losing interest in sugarcane farming. All the while, five privately-owned refineries...
www.newagebd.net
Govt should act to save cane farming, sugar mills
THIS is a matter of concern that whilst the closure of six of the 15 state-owned sugar mills and some expense reduction steps have failed to make the remaining ventures profitable, farmers appear gradually to be losing interest in sugarcane farming. All the while, five privately-owned refineries keep dominating the domestic sugar market. Sugarcane farming in the cane-production belt of Rajshahi has declined by about 52 per cent in a decade, now having reached a point where growers now think about whether they could sustain sugarcane farming for long. Department of Agricultural Extension data show that sugarcane was cultivated on 19,340 hectares of land in the 2026 financial year in the production belt, composed of Rajshahi, Natore, Naogaon and Chapainawabganj. But the sugarcane hectarage was 40,867 in the 2017 financial year. The sugarcane yield per hectare has, however, been almost static, with the production of 11.1 million tonnes in the 2026 financial year and 18 million tonnes in the 2017 financial year. In such a situation, growers appear not sufficiently attracted to sugarcane farming, mainly because of delayed payment, low profitability and poor pricing against increased production costs.
Growers say that they often need to wait for months for the payment for sugarcane by the mills. Whilst fertiliser and labour costs keep increasing, the production cost goes up to Tk 300 a kilogram, but the sugar mills pay them at the set price of Tk 125 a kilogram. In such a situation, the long duration of sugarcane, typically requiring 10 to 14 months has become another reason for the declining interest of the growers. They think that short-duration crops such as rice, vegetables or maize could bring them an early return on their investment. A proposition like this has affected the operation of the Rajshahi Sugar Mills and the North Bengal Sugar Mills, the entities that depend on the regional supply of cane. The Rajshahi Sugar Mills, which has an annual production capacity of 20,000 tonnes, began crushing cane in November 2024 with a production target of 6,930 tonnes of sugar in 67 days. But it could run only for 44 days, running to 15 per cent of capacity, and produced 3,172 tonnes of sugar. Whilst the Rajshahi Sugar Mills incurred Tk 700 million in losses, pushing the accumulated losses to Tk 10.64 billion, as the audit report for the 2025 financial year shows, the North Bengal Sugar Mills incurred Tk 660 million, pushing up the accumulated losses to Tk 9.86 billion in the period.
The government should not close the mills in view of food security, but it must change the operational model and modernise the mills with an aim of achieving financial sustainability.
THIS is a matter of concern that whilst the closure of six of the 15 state-owned sugar mills and some expense reduction steps have failed to make the remaining ventures profitable, farmers appear gradually to be losing interest in sugarcane farming. All the while, five privately-owned refineries keep dominating the domestic sugar market. Sugarcane farming in the cane-production belt of Rajshahi has declined by about 52 per cent in a decade, now having reached a point where growers now think about whether they could sustain sugarcane farming for long. Department of Agricultural Extension data show that sugarcane was cultivated on 19,340 hectares of land in the 2026 financial year in the production belt, composed of Rajshahi, Natore, Naogaon and Chapainawabganj. But the sugarcane hectarage was 40,867 in the 2017 financial year. The sugarcane yield per hectare has, however, been almost static, with the production of 11.1 million tonnes in the 2026 financial year and 18 million tonnes in the 2017 financial year. In such a situation, growers appear not sufficiently attracted to sugarcane farming, mainly because of delayed payment, low profitability and poor pricing against increased production costs.
Growers say that they often need to wait for months for the payment for sugarcane by the mills. Whilst fertiliser and labour costs keep increasing, the production cost goes up to Tk 300 a kilogram, but the sugar mills pay them at the set price of Tk 125 a kilogram. In such a situation, the long duration of sugarcane, typically requiring 10 to 14 months has become another reason for the declining interest of the growers. They think that short-duration crops such as rice, vegetables or maize could bring them an early return on their investment. A proposition like this has affected the operation of the Rajshahi Sugar Mills and the North Bengal Sugar Mills, the entities that depend on the regional supply of cane. The Rajshahi Sugar Mills, which has an annual production capacity of 20,000 tonnes, began crushing cane in November 2024 with a production target of 6,930 tonnes of sugar in 67 days. But it could run only for 44 days, running to 15 per cent of capacity, and produced 3,172 tonnes of sugar. Whilst the Rajshahi Sugar Mills incurred Tk 700 million in losses, pushing the accumulated losses to Tk 10.64 billion, as the audit report for the 2025 financial year shows, the North Bengal Sugar Mills incurred Tk 660 million, pushing up the accumulated losses to Tk 9.86 billion in the period.
The government should not close the mills in view of food security, but it must change the operational model and modernise the mills with an aim of achieving financial sustainability.
