The volume of sugar imported into Kenya rose to 237, 581 metric tonnes between January and June this year.
Figures from the Sugar Directorate indicate that this is a 19% increase from 200,442 metric tonnes imported over a similar period last year.
Prompted by this surge in imported sugar, the state imposed a temporary ban on any further shipments of the commodity into the country.
This excess importation in H1, 2020 has been blamed for severe market distortions, including the prevailing low recorded at factory level.
“Imports that undermine the local industry and depress farmers’ incomes are neither desirable nor sustainable,” said Peter Munya, Cabinet Secretary- Ministry of Agriculture, Livestock, Fisheries and Co-operatives.
This increase in the cargo of imported sugar appears to have hastened plans by the state to lease out 5 of its sugar firms to private investors.
The state has also plugged illegal imports of brown sugar as well as raw cane coming in from Uganda.
In order to revive the ailing sugar industry, the government has invited investors to take long-term leases on the five state-owned Mills- Chemelil Sugar Company as well as cash-strapped Muhoroni Sugar Company (in receivership) Miwani Sugar Company (in receivership), Nzoia Sugar Company and Sony Sugar Company Limited.
The procurement process for those leases has been undertaken in line with the Public Procurement and Asset Disposal Act, 2015.
An International Expression of Interest was advertised on 10th July 2020 and closed on 3rd August 2020.
The state intends to send out a Request for Proposal, to all the firms prequalified at the Expression of Interest stage.
Kenya’s sugar production increased from 523,652 metric tonnes in 2010 to an all-time high of 639,741 metric tonnes in 2016.
Last year, only 440,935 metric tonnes were produced against national consumption of 1,038,717 metric tonnes, resulting in a 58% deficit.
Thus, Kenya is now a net importer of sugar despite the vast potential for sugar cane development supported by a favourable climate and a dedicated farmer population.
Kenya’s sugar imports are mainly from COMESA following the 2002 sugar safeguard.
In the first quarter of this year, Kenya imported 157,529 metric tonnes of brown sugar from COMESA. The Agriculture and Food Authority(AFA) additionally received requests to import a total of 586,00 metric tonnes, which are yet to be approved.