[Photo: PECELI NAVITICOKO]
Farmers in the North are calling on the iTaukei Land Trust Board to review agricultural land rents, saying high lease costs are adding to the financial pressures facing the sugar industry.
Rent, together with fertiliser, cultivation, harvesting and other production expenses, is becoming increasingly difficult to meet amid rising living costs and declining returns from cane farming.
TLTB maintains that agricultural land rents are not arbitrarily set, but are determined under legislation based on the unimproved capital value of the land.
Hameed Khan is among cane farmers questioning whether the rent charged reflects the size of his land and the returns he receives from sugarcane farming.
“One thing I couldn’t understand is that I have 10-point-something acres of land, but the rent is $700. That looks like about 70 dollars an acre. When you add the rent, manure, cultivation, cutting and harvesting, the cost is too much for that piece of land.”
Khan approached TLTB seeking a reduction, arguing that the current charge is placing further pressure on his farming operation.
TLTB Chief Executive Officer Solomone Nata maintains the $700 annual rent for the 10-acre property is relatively low, with the applicable rate prescribed by the Agricultural Landlord and Tenant Act.
Under the legislation, agricultural land is charged at six percent of its unimproved capital value, with the rate determined by the value of the land rather than the farmer’s returns from cane production.
“But for that $700 for 10 acres, I think that’s quite cheap. But we can discuss this and discuss your case. The landowners’ rate is fixed by the Agricultural Landlord and Tenant Act. The law provides for six percent of the unimproved capital value to be charged as rent. It is statutory.”
Nata also highlights the need for leased agricultural land to remain productive, given that such leases are granted specifically for farming.
The debate over land rents comes as cane farmers continue to seek ways of reducing production costs and improving returns from the sugar industry.
