End Mumias Sugar court fight for revival

Sugar cane is a major cash crop in Kenya but production keeps declining due to various challenges.

At the farm level, poor seed quality, disease, high cost of inputs and delayed payments are a headache.

Kenya’s total national consumption outstrips production by more than 300,000 metric tonnes. Production has declined from about 635,700 tonnes in 2015 to 491,100 tonnes in 2018 of milled sugar. This year, it is expected to reach approximately 650,000 tonnes against domestic consumption of one million tonnes.

Among the 14 sugar millers, Mumias Sugar was the largest processor with an installed annual capacity of 520,000 tonnes. This changed.

According to the Auditor General, the company is technically insolvent. As at Feb 2020, its total debt stood at Sh90.4 billion.

State-owned sugar millers are also struggling and some stopped production.

This journey has necessitated a turnaround push. In December 2021, Sarrai Group was awarded lease for Mumias Sugar revival. However, a number of court cases contesting the award have delayed the start of operations.

At this time, the focus should be the turnaround since the economic viability of the company is not in doubt.

As the supremacy battles continue, the small-scale farmer is left with a sour taste in the mouth while the economy also feels the pinch for a number of reasons, including the lost jobs and tax revenue.

Cane farmers grapple with fluctuating prices, mounting expenses and rising debt, crop losses due to uncertain rainfall, and closed factories.

There is a need for immediate revival of Mumias Sugar whether through privatisation as is the case or through State bailout to end the suffering of the impoverished farmer downstream.

Revival of this fallen giant will benefit as it shall create forward and backward linkages to the benefit of stakeholders, including the local community, farmers, employees and business.

The State should get it right by expediting the recovery of other public millers.