Private sugar millers production up as state owned mills struggle

In Summary

• Nzoia produced 6,717 tonnes from 11,530 tonnes over the period

• Privately owned Transmara Company produced 13,048 tonnes

Nzoia Sugar premises
Nzoia Sugar premises
Image: FILE

Private sugar millers registered the most improved output in January and February, despite consistent declining overall production in the sugar sector.

According to Sugar Directorate, total sugar production in the two months dropped by 15 percent to  99,199 tonnes, compared to 116,654 tonnes achieved in the same period last year.

Data from state agency shows that production from the once giant sugar miller Mumias fell 100 per cent, same as that of Kwale International Sugar Company.

Nzoia produced 6,717 tonnes from 11,530 tonnes over the period. Chemelil produced 2,720 tonnes from 4,449 tonnes while Muhoroni produced 4,779 tonnes from 5,147 tonnes.

Privately owned Transmara Company produced 13,048 tonnes,  a 36 per cent increase from 9,600 tonnes over the same period last year. This was  attributed to increased cane supply in the zone.

West Kenya production rose to 22,360 tonnes from 20,880 tonnes. Sukari Industries registered 13,328 tonnes from 11,456 tonnes.

Butali also recorded a slight improvement of 14,688 tonnes from 14,279 tonnes.

This comes amid plans by the government to sell a 51 per cent stake in Sony, Chemelil, Nzoia, Muhoroni and Miwani companies to investors and reserve 24 percent for farmers and employees by July.

The government will then sell a remaining 25 percent stake in the milling companies in an initial public offering once the factories are profitable.

A section of farmers support the initiative, claiming the low sugar production in most regions is due to poor deliveries to the millers brought about by delayed payments, lack of motivation and low prices on the supplies.

 

Kenya National Federation of Sugarcane Farmers’ treasurer Steve Narupa said the delayed payments and low price has forced farmers to opt dal with private  millers. 

Narupa said currently, farmers fetch an average of Sh3,700 for one tonne of cane supplied to the public millers while companies such as Sukari Industries offer Sh4,000 per tonne.

“Farmers have been rushing to supply the private millers leading to oversupply. Maybe privatisation, as government oversees and support the sector, will help farmers attain better prices of their supplies,” Narupa said.

In the latest data by Kenya National Bureau of Statistics cane deliveries to factories dropped to 535,520 tonnes in January compared to 687,520 in January 2018 and 581,600 tonnes in 2017.

Total sugar sales in January and February were 102,715 tonnes compared to 108,257 tonnes sold in the same period last year, a drop of 5 per cent. The total sugar closing stock held by all the sugar factories at the end of February 2019 was 4,813 tonnes against 14,866 tonnes in February 2018.