The national average price of sugarcane delivered to various millers has dropped further this month, chopping earnings to farmers but handing relief to consumers of the sweeter on lower retail prices.
The Sugarcane Pricing Committee– an autonomous committee comprising the Agriculture and Food Authority (AFA), the Ministry of Agriculture, farmers, millers, and sugar-producing counties– has cut cane prices to Sh4,950 per tonne in August.
This marks a decline from a price of Sh5,125 per tonne in June. In February a tonne of sugarcane was priced at Sh6,100 which means that the cost of the raw material has fallen by 18.85 percent over the six months to August.
“Following the expiry of the interim cane pricing committee and in the absence of a Cabinet Secretary to appoint the same, the price for cane per tonne in the interim for the month of August is guided at Sh4,950,” Jude Chesire, who is the acting director at the Sugar Directorate, wrote in a letter to farmers.
Mr Chesire is the secretary of the committee.
AFA chairman Cornelly Serem said ample rains received since last year and the State-backed fertilizer subsidy have sharply increased cane production.
“Last year, we were crushing about 17,000 tonnes in a month. Now, we are crushing about 80,000 tonnes monthly due to the availability of cane in the market,” said Mr Serem.
The glut in sugarcane supplies has eased retail prices of the commodity, handing a boost to consumers. A spot check at Naivas showed a kilogramme of the sweeter was retailing at between Sh139 and Sh180.
This is a significant decline compared to March this year when the retailer was selling the commodity between Sh185 and Sh200 per kilogramme.
According to data from AFA, domestic production of sugar hit a high of 75,685 tonnes in June, which is more than double the 34,072 tonnes that were produced in the same month last year.
Mr Serem added that the cane glut has also been partially driven by the resumption of crushing by factories. The State had limited the crushing capacity of millers between July and November last year to allow immature cane to mature.
“Since we resumed crushing, the farmers started harvesting the cane that was maturing during the period when we had restricted millers to crush at half their capacity,” he said.
All eyes will be on newly gazetted Agriculture Cabinet Secretary Andrew Mwihia Karanja to gazette a new Sugar Pricing Committee.
