At Sevanagala, Pelwatte:

Better management ensures growth in sugarcane industry

By L.S. Ananda WEDAARACHCHI

“The sugarcane industry has achieved a remarkable progress during the last six months under the new management of Sevanagala and Pelwatta sugar factories”, Productivity Promotion Minister Lakshman Seneviratna said.

Both the companies were taken over by the government last year under the Parliamentary Act on ‘revival of underperforming Enterprises and Underutilized Assets’.

The ‘Sunday Observer’ interviewed Minister Lakshman Seniviratna, last week.

Question: There was a breakdown in operations at the said sugar factories during the transition period from the private sector to the public sector. How did you manage to overcome the difficulties and improve the production within a span of five months?.

A: It was really a challenge to us. Some machine parts had to be replaced as the originals were found missing. The majority of the employees and the sugarcane cultivators were also not happy with the previous owners. After a series of discussions we could persuade the workforce to commit themselves to their jobs in the larger interest of the country. My ministry conducted a number of workshops and productivity seminars.

After motivating them all the workers, Chief Operating Officers, General Managers and Superintendents did their utmost to improve the overall setup of the factories to bring it to the current position.

Q: What was the reason for the lack of cooperation between the previous management and the workforce and sugar cultivators?

A: The staffers’ salaries and due payments of sugarcane suppliers were not paid on time by the previous management. The cultivators who are ordinary farmers were anxious to have their dues paid without delay. They do not undergo such difficulties under the new management.

Q: Do you think the local sugarcane industry has a better future?

A: India, Thailand, Malaysia have developed the native sugarcane industry. Although our own sugarcane industry was far more developed in the 80s, the privatisation program introduced by the then government in 1992 resulted in the total ruins of the industry.

The Hingurana and Kantale factories cannot be revived. The industry could be developed only by revamping Pelwatta and Sevanagala factories.

Sugarcane harvesting ceremony at Sevanagala

Initial stages of sugar crushing

Sri Lanka has the necessary climate and geographical conditions conducive to sugar cultivation. The Hingurana, Kantale, Sevanagala and Pelwatte factories were operational until their privatisation in 1992. According to the ‘Mahinda Chintana’ 40 percent of the country’s sugar requirement should be produced locally on or before 2020. This shows the government’s keenness to develop the sugar industry.

Q: Sugarcane cultivation was one of the main livelihoods of those in the Moneragala district. With Hingurana, Kantale, Sevanagala and Pelwatte factories becoming non-operational the sugarcane cultivators were forced to switch over to other crops. What is the present situation?

A: Two decades ago 25,000 ha in the Dry Zone were cultivated with sugarcane; with Kantale 3840 ha, Hingurana 5660 ha, Pelwatta 4500 ha and Sevenagala 4680 ha.

Sugercane cultivation in the Dry Zone has dropped to less than 1000 ha mainly due to the unwise policies of private sugar factory owners’ the sugarcane cultivators disclosed the benefits enjoyed under the State management had been denied to the cultivators by the previous factory owners.

They alleged that they were provided with inferior quality fertilizer. The agriculture loans were also given on higher interest rates by the factory owners. Now the situation is different. The lot of cultivators has since been improved.Around 60 percent of the former sugarcane cultivators have since resumed sugarcane cultivation.

Q: Is there a corporate plan to improve the sugar industry?

A: The country’s sugar requirement per annum is about 600000 mt which Rs. 6 billion to the state coffers. On the otherhand world sugar prices are also on the increase and this has necessitated the development of the industry.

Both Sevanagala and Pelwatta factories had cultivated sugarcane in an area of 7372 ha and 31000 mt of sugar in 2010. Meanwhile, the cultivation area, quantity of cane crushed by sugar companies and sugar production in Sri Lanka dropped by 13%, 36% and 41% respectively between 2004 – 2010. The retail price of a kilogram of sugar also increased from Rs. 60 to Rs. 115 in the last 4 years.

According to the Corporate Plan prepared by the authorities the successful revamping programe of Pelwatta and Sevanagala sugar factories will help to improve the production.

The Corporate Plan has projected a production of 10 percent of the local sugar requirement within next 3 years. Manufacturing and promoting the use of compost fertilizer and developing renewable energy are the other areas of the corporate plan.