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Gov’t increases sugarcane purchase price

Sugarcane farmers will now enjoy better prices after the government, through the Sugarcane Pricing Committee, approved an increase in the price of cane from the current Sh3, 833 per tonne to Sh4, 112 per tonne, effective November 18th, 2021.

Ministry of Agriculture, Livestock, Fisheries and Cooperatives Cabinet Secretary (CS), Peter Munya, said that having considered the prevailing ex-factory sugar prices over the past three months of August to October 2021 and the current upward trend in the price of sugar, the Committee resolved to base the cane price on the average ex-factory sugar price of Sh4, 770 per 50kg bag for October 2021.

Munya directed millers to adhere to the new prices while making payments to the farmers, warning that any farmer being paid less should report to the Agriculture and Food Authority for redress.

In a press statement, Munya said the sugar industry has witnessed a steady increase in sugar production due to enhanced investments by both the Government and private sector players.

“Cumulatively, sugar production in January to October 2021 was 577,807 tonnes compared to 514,727 tonnes produced in the same period last year, indicating a 12 per cent increase. Sugar production increase is due to improved availability of sugar cane in all sugar growing areas attributed to favourable weather conditions and improved cane prices. The projected sugar production in 2021 is estimated at over 660,000 metric tonnes,” explained Munya.

The CS highlighted that the Crops (Sugar) (General) Regulations, 2020 specifies the various requirements for contracts and agreements between cane growers and millers, handling, and supply of sugarcane.

The regulations provide for a Sugarcane Pricing Committee responsible for developing the cane pricing formula and reviewing cane prices. The payment for cane on the basis of set prices shall be done weekly.

Munya said that the sugarcane price calculated using the simplified formula, is largely dependent on the sugar prices as all the other parameters are fixed over a longer timeframe.

By Joseph Ng’ang’a

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