By Dominic Odipo

Kenya: The week before last, the Western Development Initiative Association (Wedia), a sugar industry lobby group, made a presentation to Parliament.

Its main thrust was that the industry in western Kenya will collapse unless cane farmers stop breaking contracts with millers in the region.

Through its chair, Joseph Barasa, the lobby group told the Parliamentary Committee on Agriculture and Livestock that, in its view, a Malava-based sugar firm, is fuelling the practice as the main buyer of cane from farmers already contracted to supply other millers in the region and must be reined in.

The latter apparently grilled some top sugar industry executives last week.

Programme

According to Wedia’s presentation, the crisis began in 2000, after the establishment of the Butali Sugar Factory in the same sugarcane zone as the offending miller.

“With Butali coming on the market with its own contracted farmers in the same neighbourhood as (the accused miller), which had hardly any contracted farmers and no sugarcane development programme of its own, the stage was set for sugarcane poaching.”

The presentation further stated that because Busia County has no sugar factory of its own, most of the offending miller’s energies have been focused on that county, culminating in the establishment of a weigh-bridge at Olepito on the Mumias-Busia road.

Comesa tariffs

“It is at Olepito that all the illegally harvested cane from Busia and Siaya counties is collected for onward transit to the company’s factory at Malava, more than 150km away in Kakamega County.”

According to Wedia, if the firm is not stopped, especially in Busia County, even the survival of Mumias Sugar, the country’s largest sugar miller, could be at stake given that within six months, the Comesa protective tariffs could disappear.

From this viewpoint, the problem in western Kenya is a threat not only to the industry in that region, but also to the sugar industry in the whole country.

So who, if anyone, is to blame for this “menace”?

According to Wedia, there are four main culprits. They include the offending sugar miller and the Kenya Sugar Board (which licensed the miller to source its raw cane from Busia, more than 100km from its mill and in a region where it has no contracted growers).

The third is a group of four influential individuals from Busia County named in the presentation and whom Wedia believes have very vigorously and corruptly been pushing the offending miller’s agenda in the region.

The fourth culprit is, collectively, the sugarcane farming fraternity in the region, especially, Busia County.

In Wedia’s view, in pursuit of short term gain, these farmers are falling into the instant cash traps laid by the miller and, inadvertently, losing both their sugarcane and their future in the process.

Knowledge gap

But not all agree. Soita Shitanda, the former Housing minister and MP for Malava, says the sugar miller has done nothing wrong.

He claimed those making the accusations do not understand the inner dynamics of the sugar industry.

“Farmers are attracted by the best overall prices,” Shitanda said over the phone last week.

“(The miller) could not have been accessing so much sugarcane from the farmers in the region if the farmers themselves were not co-operating.”

Shitanda specifically pointed out that, for example, Mumias Sugar charges a levy of Sh1,100 for every tonne of sugarcane it sources from the Busia zone (it is not clear if this includes deductions to recover money lent to the farmers to buy inputs).

However, in contrast, he said, the offending miller charges only Sh300 per tonne, regardless of where the sugarcane is sourced from.

“If the factory prices per tonne were equal, where would the more sensible farmer go?” he posed.

In addition, Shitanda said, the miller pays for its sugarcane deliveries within three days after the cane has been received at the factory.

Mumias pays after three months, he said, and that is after it has delayed the cane-cutting for up to a whole year after it has matured.

What about the issue of the miller buying cane from farmers contracted to Mumias Sugar Company?

“Mumias has never published a list of the farmers it has contracted. Let it first publish that list then the discussion can continue,” he retorted. According to Shitanda, Mumias has not exploited its great size to stamp its authority on the industry.

Those are the two sides to this debate. Your pick!

The writer is a lecturer and consultant in Nairobi.

dominicodipo@yahoo.co.uk