Kenya’s sugar industry has the potential to be one of the country’s larger economic drivers. However, the sector has been in a state of upheaval. From proposed zoning laws that threaten farmers, to diminished output, the industry is not without its problems.
This past month, it emerged that Kenya’s sugar imports jumped 144% due to low local output. According to Kenya’s Sugar Directorate, a regulator for the industry, imports between January and April stood at 150,302 tonnes compared with 61,516 in the corresponding period last year.
The cane growing sector is so ubiquitous that it has always attracted interest and more so, regulation from the country’s government.
In fact, the State had announced plans to introduce zoning laws to deal with rampant ‘sugarcane poaching’, which has been one of the issues affecting the industry. This would mean that sugar factories would only buy cane from farmers they have contracted and whose crop they have helped to develop. This proposal has been met with fierce resistance from a number of growers from across the country.
Despite these hurdles, efforts are underway to restore the industry to its former glory.
Michael Arum, Coordinator of the Sugar Campaign for Kenyan Cane Growers, a representative organisation for the industry, sheds light on how the sector can transform and what the future holds for Kenya’s contentious sugar industry.
In your opinion, what are some of the problems facing Kenya’s sugar industry?
The problems can be tied around production, productivity, efficiency, competitiveness among others.
- Low production is a result of inadequate sugarcane and factory efficiency. Many farmers have been demoralized as a result of poor return and delayed payment resulting into some of them transitioning to other crops. Poor return is as a result of low cane price, high farm input and services and shrinking land sizes.
- Productivity in the sugar industry is below world average per hectare. Kenya sugarcane average yield 54tones per/ha compared with world average of 63tones/ha. Low Productivity is caused by poor cane husbandry, poor seed quality and lack of affordable accessible finance for cane development.
- Efficiency in the sugar industry is a problem as the systems and procedures contribute to serious losses that result into reduced net earnings. In many cases farmers receive negative statement as a result manipulation at weighbridges, cane spillage, poor harvesting, poor loading – leaving a lot of cane in the field. Poor ploughing, harrowing and planting methodologies are areas of wastages. At the factory levels, all factories do not have standard system to ensure quality cane. Secondly, state owned factories are not maintained resulting to using many tons of cane to produce a tone of sugar (example is 18TC/TS against best practice of 9TC/TS). These State-owned sugar mills have huge wage bill – extremely jeopardizing the prospect doing profitable business
- High cost of input and services and expensive sugar process has led to uncompetitive sugar. This has resulted into continuous COMESA safeguard measures as Kenyan sugar cannot compete. For example, Kenya sugar is USD870 as compared to Malawi USD3000 or Zambia USD400
Do you think Kenya has the capacity to produce its own sugar without the need for imports?
Yes, Kenya has enough land to produce adequate sugarcane. Combined factory capacity is 35,000 TCD. This capacity can support the country achieve the objective self-sufficiency and even surplus for export
Do you believe that Kenya’s sugar industry should be completely privatized or is government intervention necessary?
The government should completely divest from doing business. This will give the government legitimacy of being regulator, overseer and policy holder.
In your opinion, is Kenya’s sugar sector likely to benefit from more regulation or less regulation?
The sugar industry should have laws (regulation) that promote production, productivity, efficiency, competition and competitiveness. If less or more regulations will result into achieving those key policy issues, that the regulation that the industry will support.
Given the troubled state of the sector, do you believe that sugar cane farmers should abandon their crop and invest in sugar beets instead? (Or non-sugar related crops altogether)?
Sugarcane is done in appropriate climatic condition. Sugar-beet does best in temperate climate and if can be produced competitively, we will support it. However, it was tried in Mumias and was abandoned due to many challenges.
[Mumias is a sugar cane-rowing town in Kenya’s Kakamega County]
On transitioning to other crops, this is not necessary as farmers need both cash crops as well as food crops. The best option is diversification at the farm level to produce sugar, staple and high value crops.
What advice do you have for entrepreneurs looking to get into sugar cane farming?
Let them join us, there is money in doing cane farming as a business.