The Lower Eastern Times Opening The Third Eye
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The government has lowered the minimum price of sugarcane from Sh5,750 to Sh5,500 per tonne, marking a Sh250 reduction.
In a directive released on April 24, the Kenya Sugar Board instructed all licensed millers to adopt the new price immediately and ensure timely payments to farmers nationwide.
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The adjustment is intended to strike a balance between protecting farmers’ earnings and sustaining millers as reforms continue in Kenya’s sugar sector.
The new rate was approved following a review by the 4th Interim Sugarcane Pricing Committee, which assessed market trends, production costs, and stakeholder input before reaching its decision. The committee had been appointed earlier by Agriculture Cabinet Secretary Mutahi Kagwe.
Reports indicate millers had proposed a steeper drop to about Sh5,000 per tonne due to rising operational expenses and falling sugar prices. However, the government opted for a smaller cut to shield farmers from a more significant income loss.
Officials say the move is aimed at maintaining stability in the sector while adapting to changing market conditions.
The price review comes amid increased sugar production in 2026, driven by improved cane supply and higher factory output. The revival and leasing of previously inactive state-owned mills to private operators has also boosted production capacity.
As a result, sugar prices have declined, with a 50kg bag dropping from about Sh7,000 to between Sh6,000 and Sh6,100.
This drop has influenced the revision of cane prices, as the cost of raw materials is closely linked to sugar’s market value.
Industry players warn that keeping cane prices high while sugar prices fall could strain millers and disrupt the sector’s sustainability. The revised pricing is therefore meant to align production costs with market realities.
Despite the reduction, Kenyan farmers still earn more than their regional counterparts, with those in Tanzania earning around Sh4,900 per tonne and Uganda about Sh4,500.
The new pricing forms part of wider reforms led by Kagwe, aimed at reviving struggling mills, improving efficiency, and attracting investment into the sugar industry.
