How Sugar "Daddies" are Reaping Big from our Sugar Industry

The Kenyan sugar industry has been faced with many challenges since independence.  It has always been a political crop in the Western Region.  Farmers have always been at the receiving end of the woes facing the sub sector. Embezzlement of taxpayers’ money injected to revive the collapsing sugar factories, non-payment of sugar farmers, bad weather, and obsolete technologies are among other challenges facing the industry.

Each regime has always used the crop to woo voters especially during the electioneering period.  At the same time the so called sugar daddies have made the crop their cash cow at the expense of the sugar cane farmers.

What can happen if we open our sugar market

Opening the sugar market could be the long term solution to our sugar sector. However, importing sugar means importing labour consequently increasing the level of unemployment.  Sugar industry employs over 200000 farmers and more than 6 million people derive livelihoods from the sweetener.

The consecutive governments have continuously supported sugar industry. One Kg of sugar can be imported at Kshs. 40 from Brazil, it is far much cheaper to import sugar than produce locally.  But how do we make Kenyan sugar industry competitive? How do we kill cartels killing the industry? Is there a political will to have a long term solution to our sweetener farmers?

2017 sugar Gold rush

In 2017 the treasury allowed importation of duty free sugar from non-Comesa countries between may and August. The sugar daddies have maximized their profits by importing sugar from Brazil at approximately Kshs 45 per Kilo. They made abnormal profits since even with such low import price sugar has traded between Kshs 100 and 120.

True to their expectation, they have reaped big from the importation of duty free sugar however the alleged fights among the sugar daddies has exposed many evils. It has been revealed that sugar was imported in a rush leading to dumping of contraband sugar creating an influx in the market. 

The sugar imported to the country during that period is enough to sustain the country for the next fifteen months without growing  a single cane.  Worse still the sugar imported during the window period between May and August has higher levels of copper than the recommended posing health threat to consumers. The question is why the government left the importation of duty free sugar without imposing a quota to the unscrupulous traders.

How should stakeholders take care of sugar "daddies”

Farmers need to consider other crops which might make more economic sense other than wallowing themselves in sugarcane only.

The challenges facing the sector include obsolete technology, lack of consistent supply of raw materials throughout the year, high cost of production and lack of political will to create a long term solution to the sector. Political will especially from the sugar belt politicians to revive the sugar industry is needed now than before.

While it costs Kshs. 40 to produce a kg of sugar in Mauritius, it costs double to produce the same in Kenya.  Obsolete technology is the cause of high cost of production.

Adopting new technologies and irrigating the sugarcane farms can create long term solution to the industry.  Privatization of the state owned sugar factories has also been suggested as a solution.

A lasting solution need to be devised to make the sugar competitive before the Kenyan farmers are edged out of the market once the COMESA Safeguards comes to an end.