The government has embarked on an ambitious plan to revitalise sugarcane production in the country, with the ultimate goal of lowering the prices of sugar.
The plan includes streamlining the supply chain, enhancing production efficiency and reducing bottlenecks in the distribution process, in a bid to bring down the cost of sugar for consumers while increasing profitability for local farmers.
The government through the reforms seeks to cure the perennial challenges in the cane sector, such as low funding for sugarcane development and milling, weak outgrower institutions, low availability of quality planting material, weak research infrastructure and poor farmers/millers relations.
The brief detailing the sugar reforms seen by Nation indicates the government has already started facilitating access by sugarcane farmers to subsidised fertiliser, thereby improving sugarcane yields and bringing down the cost of production, a move that will result in the low prices of sugar in the market.
In terms of provision of infrastructure, the government has developed Draft Regulations on the quality-based sugarcane payment system, which seeks to incentivise the growers to deliver and earn from good quality cane.
“Apart from setting stage for quality-based cane payment, these regulations provide for the management of sugarcane collection centres to ensure fairness,” reads the document.
The government also believes that the creation of a Kenya Sugar Board as a separate entity from Agriculture Food Authority (AFA) with the main task of regulating, developing, and promoting the sugar industry co-ordinating the activities will ease farmers' issues in the production process resulting in low sugar prices in the market.
In a bid to boost production, the government is also keen on investing in other parts of the country as a way of expanding sugarcane growing zones beyond the traditional known areas in Western region.
The new sugarcane frontiers in the pipeline are in the coastal region – the lower Tana Delta and the Bura Irrigation scheme as well as Kerio Valley, where studies have been done and pointed to good sugarcane potential, albeit faced with poor infrastructure challenges.
As provided for in the Sugar Act 2024 signed by President Ruto last year, the establishment of factory sugarcane production catchment areas which includes the Central, Lower Western, Upper Western, Southern and Coastal regions is on with the main aim of ensuring efficiency in sugar production in the regions thereby increase increasing the supply leading to low prices.
Following the Presidential directive on sugar reforms in May 2003, the government administratively organized sugar factories in the catchment areas as proposed in the taskforce.
In a bid to ensure that farmers get maximum earnings from their cane delivered to factories, there is a sugarcane pricing committee which has been established through the Sugar Act to ensure equitable returns to growers and millers.
This committee is also expected to come up with a bonus payment system for sugarcane farmers.
Further, the government through the Kenya Sugar Board is also developing a central database for farmers, supported by Geographic Information System (GIS) mapping of all the fields in order to facilitate smart contracting.
The farmers’ data base will also ensure that all sugarcane fields are contracted to specific mills. This provision is in the Draft Sugar (General) Regulations, which are ready for public participation and the process will kick off soon.
To support development of quality materials of cane, the National Treasury has already approved a disbursement of Sh600 Million to the Kenya Sugar Research and Training Institute (KESRETI).
The plan to revitalise the five State owned sugar companies through writing-off of all their debts amounting to Sh67 billion and payment of farmers’ due is meant to restore trust from farmers and encourage production of sugar in the country that will ultimately be cheaper due to the ease of the cost of production.
The government interventions are meant to cushion consumers against the impending increase of prices of sugar beginning next month following the introduction of the new tax on sweeteners.
This follows the gazettement of the Sugar Development Levy Order, 2025 after President Ruto signed into law the Sugar Act, 2024 The new law introduces the Sugar Development Levy on both domestic and imported sugar at four percent of the value of the commodity.
Speaking in Kakamega on Monday during his tour of the Western region, President William Ruto said the various ongoing strategies by the government in the sugarcane industry will soon yield results and the country will become importer due to surplus production.
President Ruto said the writing off of Sh117 billion in debts, including the payment of Sh1.7 billion in farmers' arrears and Sh650 million owed to employees, was part of the efforts to revive the sector.
“With a record 832,000 metric tons of sugar produced last year, Kenya is on course to attain surplus production and commence regional exports by 2027, turning sugarcane cultivation into a viable and rewarding venture," he said.
Speaking at the same event, Deputy President Kithure Kindiki said the reforms will significantly transform the lives of people.
“Boosting the manufacturing and industry is one of the engines that will take our country from where it is to the first world. This is the easiest way to do it because industrialization is the key to creating the nation’s wealth,” Prof Kindiki said.
Sugar production has seen significant growth over the recent years, with the exception of 2023, when production was hampered by an extended drought situation.
This shortage necessitated the closure of mills for a period of four months to allow for sugarcane regeneration.
However, last year, there was significant growth in the sugar production as the country produced a total of 832,000 metric tonnes compared 472, 773 metric tonnes produced in 2023.
The country has also witnessed a reduction in sugar imports over the recent years, with imports decreasing from 442,000 metric tonnes in 2020 to 339,000 metric tonnes in 2024.