Kenya has formed a taskforce to help revamp the sugar industry, which is facing numerous challenges, top among them being the $26 million owed farmers debt that has seen most growers abandon the sector altogether.
The government hopes that the task force will help identify challenges and offer practical solutions that will improve the industry's competitiveness.
“We have seen over the years this sub sector suffer through production declines, putting us in an import-reliance position,” said Agriculture Cabinet Secretary Mwangi Kiunjuri, adding, “We want all the stakeholders in the value chain to benefit from their input and we hope that the taskforce’s recommendations will address the uncompetitiveness of the industry.”
Kenya’s sugar sector has been dogged by poor farming methods, cane poaching, obsolete equipment, outdates factories, debts and poor quality cane, which have seen production slump, even as the country stared at rising imports that hit 900,000 tonnes last year.
The taskforce is now expected to review the policy, legal, regulatory and institutional framework of the sugar industry; emerging challenges; the value chain including research and review importation and taxation structures in the sugar sector.
The team will also undertake an absolute and comparative assessment of the industry’s competitiveness in the East African Community, the Common Market for Eastern and Southern Africa and the world.
This comes even as it emerged that the Kenya's cane farmers will have to wait longer to receive $26 million owed to them for cane deliveries to public factories.
“We have audit delays on these amounts and this is the reason for the delay in the farmer’s payments. I have already written to the National Treasury to provide the funds but we are also awaiting the audit report on these payments so that we can pay the right persons who delivered the cane,” Mr Kiunjuri said.
Kenya imported more sugar than it produced for the first time last year, coming at a time that saw its production fall to its lowest as farmers staged protests and boycotted milling firms.
The 2018 Economic Survey shows that imports almost tripled to 989,600 tonnes last year against a production of 376,100 tonnes in 2016. This was the first time in five years that the country was importing more sugar than it produces.
Last year, the area under cane reduced to 191,200 hectares compared with 220,800 hectares in 2016, and 22,705 hectares since 2013.
“The reduction in cane area was attributed to conversion of some area under cane to other crops. Further, the quantity of cane delivered to factories fell by 33.3 per cent from 7.2 million tonnes in 2016 to 4.8 million tonnes in 2017. This was on account of prolonged dry weather conditions unfavourable for the growth of cane, leading to harvesting of immature cane.
“As a result, the average sugarcane yield fell to 55.3 tonnes per hectare in 2017 compared with 62.2 tonnes per hectare in 2016, representing a decrease of 10.9 per cent,” the Kenya National Bureau of Statics says in the survey.
Kenya also saw its total domestic sugar production decline by 41.2 per cent from 639.7 thousand tonnes in 2016 to 376.1 thousand tonnes in 2017.
The bureau said that a total of 989.6 thousand tonnes of sugar was imported in 2017 to bridge the deficit occasioned by the low production during the year.