Sugar millers locked out of duty free imports windowFriday February 03 2023
Sugar millers have been locked out of the multi-billion-shilling duty-free sugar imports window.
The move by the Sugar Directorate is based on the 2017 occurrence where millers abandoned buying and processing sugarcane from farmers after they were allowed to bring in the commodity outside of the Common Market for Eastern and Southern Africa (Comesa) without paying duty.
The move subjected farmers to huge losses as sugarcane that was ready for harvesting was left on farms for long as millers concentrated on repackaging and selling imported sugar, which the regulator says is way cheaper when compared with milling.
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“We have received a number of applications from millers who want to import sugar but we have made a deliberate decision to stop them because they will focus more on repackaging and selling what they have imported other than milling cane from the local farmers,” said Willis Audi, head of the directorate.
“In 2017, the repercussions of having allowed millers to import sugar were heavy on farmers and we don’t want to repeat that,” he said.
Kenya opened an import window in December that would see traders ship in 100,000 tonnes of sugar outside the Comesa region to curb an imminent shortage that has pushed up the cost of the sweetener.
Mr Audi said there are at least 240 traders who are registered as sugar importers and they no longer need extra requirements, such as reapplying for permits to ship in the commodity.
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He said due to the huge number of traders involved, the directorate is limiting the quantity that each can import to at least 1,000 tonnes.
Kenya relies on imported sugar to meet its annual deficit which has now grown to one million against production of 800,000 tonnes annually.
Tightening supply has seen the price of the commodity shoot from a low of Sh230 for a two-kilogramme pack in January last year to Sh320 currently in what the directorate has attributed to high prices both on the local and imported sweetener.