Kenya launches comprehensive reforms to revitalize sugarcane sector 

KENYA – The Kenyan government has unveiled an ambitious plan to revitalize sugarcane production, aiming to address longstanding challenges in the sector while reducing sugar prices for consumers.  

The initiative focuses on streamlining the supply chain, enhancing production efficiency, and addressing distribution bottlenecks to benefit farmers and consumers alike. 

Among the key reforms is the distribution of subsidized fertilizer to improve productivity and boost farmers’ incomes.  

President William Ruto emphasized the government’s commitment to tackling issues such as low funding for sugarcane development, inadequate planting materials, weak research infrastructure, and strained farmer-miller relations. 

The government has also introduced draft regulations for a quality-based sugarcane payment system, which will incentivize farmers to deliver high-quality cane.  

“Apart from setting the stage for quality-based cane payment, these regulations provide for the management of sugarcane collection centers to ensure fairness,” a government document stated. 

To ensure equitable returns for growers and millers, a sugar pricing committee has been established under the Sugar Act 2024

The committee will oversee pricing and develop a bonus payment system to enhance farmers’ earnings. The Sugar Act also creates sugarcane catchment areas, intended to synchronize milling operations and manage supply more efficiently. 

President Ruto has directed Agriculture Cabinet Secretary Mutahi Kagwe to finalize regulations under the Sugar Act to eliminate cartels and bring clarity to the sector.  

The government is also expanding sugarcane growing zones beyond the traditional Western region and creating a central database for farmers.  

Supported by Geographic Information System (GIS) mapping, the database will enable smart contracting, ensuring that all sugarcane fields are allocated to specific mills. 

To address the issue of quality planting materials, the National Treasury has approved Kes 600 million for the Kenya Sugar Research and Training Institute (KESRETI). This funding is expected to support the development of superior sugarcane varieties. 

Additionally, the government has committed to revitalizing five state-owned sugar companies by writing off debts totaling Kes 67 billion (US$518.4M) and settling outstanding payments to farmers.  

These measures aim to rebuild farmers’ trust and encourage greater production. 

However, the sector faces challenges, including the impending increase in sugar prices due to the introduction of a new tax on sweeteners under the Sugar Development Levy Order 2025.  

The levy, set at 4 percent of the value of both domestic and imported sugar, is part of the recently enacted Sugar Act 2024. 

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