Ailing Mumias Sugar Company #ticker:MSC is expected to restart milling on Wednesday after the management inked a deal with farmers to supply cane.
The miller has opted to source cane from neighbouring Nyanza and Trans-Nzoia counties due to a crippling shortage in its Kakamega and Busia catchment.
The management has been expecting Sh2 billion bailout from the Treasury to revive the miller but the funds are yet to be released.
Despite the delay, board chairman Kennedy Ngumbau Mulwa has been upbeat about preparations for resuming cane crushing.
A test-run of the mill was carried out last week. Business activities in Mumias town have been disrupted since the miller went quiet. “We have put in place everything to ensure that milling kicks off without any hitches. We have made arrangements to ensure that farmers are paid after cane deliveries,” said Mr Mulwa.
On Tuesday, farmers from the region received news of the planned resumption of milling with excitement.
Kenya Sugarcane Growers Association (Kesga) secretary Simeon Wesechere said the management of the company should prioritise cane development to improve supply.
“We support the miller for doing everything possible to ensure the factory is operational. But we want them to address the issue of paying farmers for cane deliveries and come up with a programme on supply of farm inputs to increase production,” said Mr Wesechere.
Meanwhile, the Kenya Sugarcane Millers Association (Kesma) has made recommendations that the sugar growing regions be divided into five zones, a move that has not gone down well with some farmers.
In a letter addressed to the Agriculture and Food Authority over the Draft Sugar Regulations 2018, the millers said each region should comprise of more than one sugar mill to do away with monopoly.
They also propose that farmers should be free to sell their produce to millers of their choice.
Kesma is a lobby for sugar manufacturers. The proposed regions include Central comprising of Siaya, Kisumu, Nandi and Kericho); Upper Western which includes Bungoma, Kakamega, Trans-Nzoia, Uasin Gishu and Nandi; Lower Western (Mumias and Busia); Southern (Migori, Homa Bay, Kisii and Narok), and Coastal (Kwale, Tana River and Lamu).
But the farmers, through the Kenya National Federation of Sugarcane Farmers, said such a move would limit their market.
Stephen Narupa, the lobby’s treasurer, said the move would only be beneficial to millers.
“This is monopoly disguised as zoning. We want a free market where farmers will choose where to sell their cane. Farmers are free to contact with highest paying miller,” said Mr Narupa.
Unlock a world of exclusive content today!Unlock a world of exclusive content today!
