The journey towards reforming the sugar sector in the country has begun in earnest after President William Ruto formally signed the Sugar Bill into law.
The Sugar Bill (National Assembly Bills No. 34 of 2022) seeks to revive the sugar sector by, among other things, enhancing growth, regulation and support for sugarcane farmers across the country.
Sponsored by Navakholo MP Emmanuel Wangwe and Bungoma senator David Wakoli, the Bill was considered and approved by both the National Assembly and the Senate in October this year.
It seeks to provide a framework for the regulation, development and promotion of the sugar industry.
Its signing into law now means that the government can begin the transformation process of the sugar sector that has been ailing since 2013.
The law seeks to address areas such as the increased costs of sugar production, declining land acreage under sugar, lack of markets for sugar, failure to control imports and exports of sugar, poor management of sugar companies and a lack of research and cane development initiatives.
The newly signed law also re-establishes the Kenya Sugar Board, restoring roles that were previously managed by the Sugar Directorate of the Agriculture and Food Authority.
The Board, comprising 14 members with representation from farmers, millers, government agencies and the Council of Governors, will set industry standards, facilitate local and international trade in sugar, regulate prices, and provide direct advisory support to sugar growers.
The Act also mandates the Kenya Sugar Board to appoint crop inspectors to enforce compliance, a move expected to address unregulated production and protect farmers from exploitative practices.
With an eye toward industry sustainability, the Act introduces a Sugar Development Levy capped at 4 percent of both the value of domestic sugar and the Cost Insurance Freight (CIF) value of imports.
The funds generated will be allocated to various critical areas including 15% towards factory development and rehabilitation, 15% allocated to sugarcane-producing regions on a pro-rata basis based on production capacity for infrastructural development and maintenance; 10% for the administration of the Board and 5% to the functions of sugarcane farmers’ organizations.
Cane farmers are set to benefit from 40% to cane development and 15% to factory rehabilitation, to boost productivity, develop infrastructure and directly support cane farmers across sugar-producing regions.
The Kenya Sugar Research and Training Institute will benefit from 15% of the development levy, empowering the institute to advance research and improve training standards. This investment in knowledge and skills aims to strengthen Kenya’s competitiveness in both local and global sugar markets.
Additionally, the Act establishes a five-member Sugar Arbitration Tribunal with a mandate to arbitrate disputes between sugar farmers and other players in the sugar subsector; and disputes relating to cane pricing and contract farming.
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