Monday, January 9, 2012

Sugar sector of Sri Lanka needs to be revived



By Dr.C.S. Weeraratna (csweera@sltnet.lk)

Sugar is one of the main food items consumed in Sri Lanka. Sugar cane (Saccharum officinarum) is the only crop cultivated in Sri Lanka for manufacture of sugar, although there are crops such as coconut, kitul and palmyrah which can be used to manufacture sugar based substances such as jaggery and treacle. Sugarcane has been cultivated in Sri Lanka since 1840s.

About two decades ago, in 1990s, sugarcane was cultivated in about 25, 000 hectares in Hingurana, Kantale, Pelwatta and Sevanagala. But, it has come down to around 7,300 ha, and at present, only Pelwatta Sugar Industries, and Sevanagale Sugar Industries are involved in commercial production of sugar. Hingurana sugar factory which was closed for a long time has started to cultivate sugarcane and Kantale Sugar Industry is due to start cultivation of sugarcane in the near future.

The present total annual requirement of sugar in the country is around 600,000 tonnes but at present only about 30,000 tonnes are produced annually. In 2010 only 31,000 tonnes were produced locally and the balance imported. The foreign exchange involved in importing our sugar needs in 2010 was around Rs 41 billion.

One of the important by-products of the sugarcane industry is ethyl alcohol (ethanol) which is made from molasses. Ethanol is becoming extremely important as a fuel additive, in view of high prices of fossil fuel. In addition to ethanol, a number of other by-products such as acetone, vinegar, acetic acid etc. can be manufactured from molasses. Bagasse, the material left after extraction of juice is used to generate energy and also to manufacture fibre board. These by-products are imported involving around Rs. 5 billion annually.

Present status of the sugar sector

According to Central Bank annual reports the total extent under sugarcane has decreased from 8445 ha in 2005 to around 7,300 hectares in 2010 and cultivated in Pelwatta and Sevanagala. Sugarcane in these two areas are cultivated by the two companies (nucleus estates) and also by out growers, About 1,000 ha in other districts, mainly Amapara, and Badulla Districts, are cultivated with sugarcane by smallholders mostly for production of juggery and sugar syrup. The Average cane yields have decreased from 82 t/ha in 2003 to 50 t /ha in 2010. The conversion too has gone down to from 8.4 % in 2004 to 7.6. The total sugar produced in Sri Lanka in 2010 was 31,000 t , a decrease from 58,000 t in 2004. The total amount of ethanol produced per year from Sevanagala and Pelwatta is around 7 million litres. A considerable amount of energy is generated at Pelwatta and Sevanagala from bagasse.

Sugar sector development in the next ten years


Developing the local sugar sector will result in an improved production of sugar, ethanol, electricity and a host of industrial chemicals and thereby saving a considerable amount of foreign exchange. Increased production of sugar in the country will increase our food security. It will also increase employment opportunities in areas such as Siyabalanduwa, Buttala, Badulla. Amapara, Kantale etc. where there is a very high degree of poverty.

In view of the importance of the sugar sector in the socio-economic development and food security of the country, a concerted effort needs to be made to develop this sector. Unfortunately, some of the advisors of the previous government were of the opinion that it is profitable to import sugar than producing it locally. As a result the sugar sector remained undeveloped. However, Mahinda Chintanaya has emphasised the need to promote sugar production in the country.

By increasing sugarcane production it would be possible to meet the demand for value added by products such as ethanol, vinegar, yeast, spirits, rum (these are produced from molasses) energy, fibreboards, paper (from bagasse) etc which is estimated to increase by 50% within the next 10 years. An inter-ministerial committee of 18 members appointed by the former minister of Science and Technology in 2006, recommended that the production of ethanol ( by-product of the sugar industry) which can be used as an alternative to petrol need to be promoted. This will considerably reduce the expenditure on imported petroleum. In many countries ethanol is used to run cars.

Potential for cultivation of sugarcane

Assuming the population increase to be around 1%, the total annual requirement of sugar by 2020 would be around 700,000 t. If it is planned to produce 50% of the local sugar requirement by the year 2020, i.e to produce 350,000 t of sugar annually, it would be necessary to cultivate app. 70,000 ha. (according to the present sugar yields, about 5 t of sugar can be produced from 1 ha of sugarcane under rainfed conditions with supplementary irrigation). Vast extents of land are available for sugarcane cultivation in Anuradhapura, Monearagala and Badulla Districts. The large number of tanks in these districts, if rehabilitated could provide supplementary irrigation. Climatic and edaphic factors in these areas are suitable for the cultivation of sugarcane.

A number of factors can be attributed to the decline in the sugar sector during the last few years. The more important ones are given below. Among these are (a). Farmers not getting good quality seed cane, (b) Farmers have to wait for almost one year to get the harvest. Hence they prefer to cultivate crops such as paddy, banana which give relatively quick returns (c) High cost of inputs (labour, pesticides etc.)It costs about Rs. 500 to harvest a ton of sugarcane (d) Inadequate extension (e) Soils in most parts of sugarcane cultivated areas appear to have got eroded indicated by the sandy nature of the soils. Sugarcane has been cultivated over a long periods, in some places 15-20 years or more and as a result the soils have got deteriorated. (f) Pests and diseases. Among these are wooly aphid and white leaf disease respectivey .(g) Ratoon crops tend to give lower yields (h) Longer time taken to transport the harvested cane to the factory (i)Old machinery in the factory, and (j) Inadequate value addition.

Any programme to develop the sugar sector in the country needs to consider these limiting factors and effective measures have to be implemented to overcome them.

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