Sugarcane farmers in Uganda end strike as negotiations for price increase begin

UGANDA – Sugarcane farmers in Uganda have called off a nearly three-week strike following an agreement to negotiate a price increase for the raw material with sugar millers.  

The strike, which began on July 7, saw farmers halt their supply of sugarcane, impacting about 80 percent of the nation’s sugar production. 

Julius Katerevu, chairperson of the Greater Mukono Sugarcane Outgrowers Cooperative, announced the resumption of sugarcane supply to mills, stating that negotiations would continue for the next month.  

However, Katerevu warned that the strike would resume in September if the millers do not meet the farmers’ demands within this timeframe. 

“We can’t accept to be exploited by the millers; we currently make a loss of between Shs70,000 (US$18.80) to Shs100,000 (US$26.85) per tonne with the current prices and are ready to resume the strike if they don’t respond positively,” Katerevu said.  

He added that the Ministry of Agriculture is working with millers to ensure an increase in the purchase prices of cane. 

In addition to price adjustments, the Ministry has promised to finalize the Sugar Bill (2023), which aims to protect farmers by establishing a pricing formula and creating the Uganda Sugar Industry Stakeholder Council.  

This council will replace the Sugar Board established by the Sugar Act (2020) and regulate the industry. 

During a recent meeting in Kampala, Katerevu stated that farmers are seeking a 70 percent share of the sugar produced from their cane and a 50 percent stake in by-products such as bagasse, molasses, fertilizer, sweets, and ethanol. 

The strike was triggered by a significant drop in sugarcane prices from UGX 250,000 (US$67.72) per tonne to UGX140,000 (US$37.92) over the past year.  

Sugar millers have attributed the price drop to a regional market glut and excessive domestic sugar stocks. 

Earlier, the East African Community (EAC) Secretariat granted tax-free import permissions to Rwanda, Tanzania, and Kenya to address their domestic sugar deficits. 

Kenya, the largest consumer, alone accounts for 90,000 tonnes of Uganda’s annual sugar export market. 

The Bank of Uganda revealed a sharp decline in sugar exports from 229,723 tonnes in 2022 to 99,283 tonnes in 2023.  

This drop in export volume has also led to a reduction in industrial earnings from US$163.75 million to US$75.79 million. 

Jimmy Kabeho, chairman of the Uganda Sugar Manufacturers Association, noted that Kenya’s shift towards imported duty-free sugar has negatively impacted Uganda’s sugar export market.