The farmers have rejected the reduction in the price of sugarcane and resolved to withdraw their supply to factories beginning today, reports Business Daily.
The Sugarcane Pricing Committee—whose members include the Agriculture and Food Authority, the Ministry of Agriculture, farmers, millers, and sugar-growing counties—slashed the price of sugarcane to Sh4,950 per tonne for this month. This has cut down even further from earlier in the year and hit farmers’ earnings, but it has also offered some relief to consumers through lower retail sugar prices.
The new price represents a decrease from Sh5,125 per tonne in June, and a significant drop from Sh6,100 per tonne in February, reflecting an 18.85 per cent fall in sugarcane prices over the past six months.
“Following the expiry of the interim cane pricing committee and without a Cabinet Secretary to appoint a new one, the price for cane per tonne in August is set at Sh4,950,” Jude Chesire, the acting director at the Sugar Directorate and secretary of the pricing committee, stated in a letter to farmers. The AFA has attributed the price drop to a surplus in production.
However, the Kenya National Federation of Sugarcane Farmers (KNFSF) has rejected the new pricing and vowed to boycott deliveries to the factories. “We are prepared to wait as long as necessary for the government to address our concerns. Farmers cannot continue working in conditions where our efforts are not fairly compensated,” said KNFSF national treasurer Stephen Ole Narupa.
AFA chairman Cornelly Serem explained last week that favourable weather and a government fertilizer subsidy had led to a sharp increase in cane production. “Last year, we were processing around 17,000 tonnes a month. Now, we’re processing about 80,000 tonnes monthly due to the increased availability of cane in the market,” he said.
Narupa, however, criticized the AFA for failing to properly regulate the sugar industry. “The regulator is the biggest threat, flooding our market with imported sugar and turning our country into a dumping ground for foreign products,” he said. “After allowing this influx, they quickly convene meetings to lower the price of local sugarcane, undermining our farmers and promoting foreign interests.”
The Kenya Association of Sugarcane and Allied Products (KASAP) has called on the government to halt the implementation of the lower prices. “Given the high costs that farmers incur in producing sugarcane, selling it at Sh4,950 per tonne is unsustainable and will drive us out of business,” said KASAP chairman Charles Atiang’. “We urge the sugar regulator to consider the cost of production to create a fair outcome for all stakeholders.”
Mr Atiang also claimed that some millers are making substantial profits from by-products like molasses, ethanol, and bagasse while basing the price of sugarcane solely on sugar. “Additionally, these millers are involved in transport and sell farm inputs to farmers at inflated prices,” he added.
