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Government directive increases sugarcane buying price by 10%

Sugar cANE fARMING kenya
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By George Munene

The minimum buying price of sugarcane has been reviewed from ShSh3, 700 per tonne to Sh4,040 as of April 1, 2021.

Also announced was the setting up of sucrose testing units in cane growing zones that will mark a migration to quality rather than a quantity-based system of compensation.

The 10 per cent rise marks the first appraisal of the price of cane in the country since 2018 and is in line with the recommendations made by the interim Sugarcane Pricing Committee constituted by the Ministry of Agriculture.

Agriculture Cabinet Secretary Peter Munya urged any farmer being paid less by a miller to report them, warning; “Any cases of non-compliance will attract a fine of not less than Sh50, 0000 or one-year imprisonment as per Section 37 of the Crops Act, 2013.”

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Speaking at Kilimo House, Munya added that by end of June the government will have finished setting up sucrose testing units in all sugarcane growing zones. This will mark a migration to a quality-based system of compensation meaning pay for cane will be tested before being delivered to the miller and what is paid to farmers pegged on the sugarcane’s sucrose content. 

For predictability and creating a level playing field within the sugar sector, the government will also be reviewing all contracts between growers and millers. “We want farmers to know when they grow their cane it will not rot in the farm but be harvested within a specified period, Munya said. With the new parameters set to be implemented within the sector, millers will also have seven days to settle payments to farmers after they deliver sugarcane to them.

While lauding the measure, Nzoia Outgrower Company chair Christopher Sifuna cautioned; “farmer’s bigger problem is not the buying price of cane but payment. Since 2019 Nzoia Sugar Company as an example has amassed farmer debts of close to seven million shillings. Companies that do not pay farmers within the stipulated period should have their milling permits revoked until they have paid the debts owed to farmers.”

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Farmers also still contend that this increase still does not truly reflect fair value for their cane. The price rise is based on a single cane byproduct; sugar; however, millers have branched out into making use of several other sugarcane byproducts by setting up distilleries and paper-making plants these returns have as yet to trickle down to farmers. 

Kenya’s expected sugarcane consumption for the year is anticipated at 1.07 million tonnes against an expected production of 660,000 tonnes.

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