Government increases per-tonne payment as part of sugar sector reforms
NAIROBI — In a move aimed at steadying a struggling sugar industry and easing long-standing tensions with growers, the Kenyan government has announced a modest increase in the price paid to sugarcane farmers from Sh5,300 to Sh5,500 per tonne.
The new rate, which takes effect on Monday, 26 May, will apply to all of the country’s 15 licensed sugar millers, including state-owned factories currently operated under lease agreements.
Agriculture Principal Secretary Kipronoh Ronoh said the price revision was based on market trends and designed to ensure farmers receive a fairer return.
“This adjustment follows an analysis of sugar prices at the factory gate over the past three months,” Mr Ronoh said in a statement. “We expect all millers to honour the new rate and to pay farmers promptly.”
Kenya’s sugar sector has faced years of instability. Farmers often complain of delayed payments, poor pricing, and exploitation by millers. Meanwhile, millers blame high input costs, import competition, and ageing equipment.
The government’s latest move is part of broader reforms aimed at restoring the viability of a sector once considered a pillar of rural economies in counties like Kakamega, Bungoma, and Kisumu.
Industry insiders have welcomed the price rise, though some say it doesn’t go far enough.
“It’s a small win, yes, but the cost of production has gone up far more than that,” said Joseph Ochieng, a sugarcane farmer in Mumias. “Fertilizer, labour everything is expensive. We’ve been asking for at least Sh6,000 per tonne. This is a start, but more needs to be done.”
Some millers have privately expressed concern over the government’s order. One senior figure at a western Kenya-based private mill, speaking on condition of anonymity, said, “We want to pay our farmers well, but pricing must also reflect market realities. If prices continue to be set politically, some of us won’t survive.”
Despite the criticism, the Ministry of Agriculture insists that stabilising farmgate prices is critical to rebuilding trust in the sector. The government is also seeking to revive idle mills and cut back on sugar imports, which local growers say have flooded the market and driven down prices.
Kenya’s sugar industry has long been plagued by inefficiency, corruption, and poor management. A 2023 audit by the Sugar Directorate found that most millers were operating at under 50% of their installed capacity.
For now, though, farmers like Ochieng are cautiously hopeful. “We’ll take the Sh200 increase but we’ll also keep asking questions,” he said. “We want an industry that works for everyone, not just the middlemen.”
The new pricing directive comes as the planting season begins in many sugar-growing regions, raising the stakes for compliance and timely payment. The government has warned millers who fail to meet the new rate or delay payments could face sanctions, including license reviews.
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