Farmers reap big as sugarcane prices cross the Sh4,000 mark

Jacob Shikuku tilling family sugarcane farm, he is usually busy in the farm after release from prison to make ends meet. 09/10/2014 Picture By: Chrispen Sechere.

 

Jacob Shikuku tilling family sugarcane farm, he is usually busy in the farm after release from prison to make ends meet. 09/10/2014 Picture By: Chrispen Sechere.

Sugarcane farmers in Western Kenya have every reason to celebrate after prices hit an unprecedented Sh4,200 per ton.

The rise in price comes just as many frustrated farmers had begun abandoning cane growing for alternative cash crops, leading to an acute shortage.

According to the Kenya National Federation of Sugarcane Farmers (KNFSF), a price control formula crafted by a cane pricing committee constituted last year is beginning to bear fruit.

The formula arrives at cane prices in relation to market forces of supply and demand – when demand is high, prices are adjusted upwards. According to the farmers’ federation, this is working.

Market forces

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“First, sugar millers were compelled to pay farmers Sh3,800 per ton and this increased to Sh4,000 in the second quarter. Now we are happy that farmers are taking home a whopping Sh4,200 per ton,” said KNFSF Deputy Secretary General Simon Wesechere.

Cane farmers interviewed were optimistic about the sector’s rebirth. A number who had abandoned sugarcane have started trickling back to their farms.

“I had vowed never to plant sugarcane because of the losses we incurred but with the new prices, I cannot wait to go back to it again,” said Musa Mutswenje, a farmer from Kakamega North.

Farmers have been pushing for a workable pricing formula, which led to the formation of the technical pricing committee.

The committee reviews cane prices quarterly based on current sugar prices.

According to Mr Wesechere, a 50kg bag of sugar is currently retailing at an average price of Sh6,000, necessitating an increase in the price of cane.

He said the future of the sector was bright as long as sugar firms learned to engage farmers directly and streamlined their management.

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“We can assure farmers that the future is very bright. All we need is our sugar firms, especially State-owned factories, to restructure their management and engage farmers directly so we can have enough raw material in the fields,” he said.

The sharp rise in prices can also be attributed to still competition between State-owned cane millers and private firms.

Mumias and Nzoia sugar companies are among the State firms worst hit by a shortage of raw material occasioned by cane poaching.

Both have announced suspension of milling operations, citing a cane shortage.

Private firms

Interestingly, rival private firms such as West Kenya and Butali Sugar companies in Kakamega North and Kibos have so far defied the cane shortage and continued their milling operations.

According to the federation, private firms have an edge over State millers because of regular and prompt payments.

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While private firms pay within a week of harvesting and haulage, State factories pay one month later.

Despite gloomy pictures of Western Kenya’s sugar industry over the years – from farmer’s arrears to management rows – Wesechere said all was not lost.

He noted that the sugar industry only needed commitment from all players in the sub-sector to make things work.

“That pricing has been well handled indicates that the industry can be brought back to its feet,” he said. 

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