Agriculture Ministry approves Sh654 million to clear millers' debts

 Senator Boni Khalwale inspects sugarcane at his farm in Malinya in Ikolomani. [File, Standard]

The Ministry of Agriculture has approved Sh654 million to help struggling sugar millers clear debts owed to farmers and workers.

Agriculture Principal Secretary Paul Rono announced the allocation for the 2023/2024 fiscal year, aimed at bolstering sugar sector reforms.

Out of the funds, Sh354 million will go towards clearing debts owed to farmers at Nzoia, Muhoroni, Chemelil, and Sony millers.

The ministry has set aside Sh150 million to clear three months' salary arrears owed to Nzoia Sugar workers, with the remaining Sh150 million allocated for similar purposes across other millers.

Addressing press briefing at Nzoia Sugar Factory, ="https://www.standardmedia.co.ke/business/business/article/2001479920/treasury-seeks-to-write-off-sh11764b-millers-debt">Board Chairman Alfred< Khang'ati expressed gratitude for the government's intervention saying this will ensure stability of the company.

"We appreciate the president and local leadership for advocating our revival. Payment details for workers and farmers have been submitted to AFA, with disbursements expected from Friday," Khang'ati said.

Nzoia Sugar will receive Sh54 million to settle debts owed to farmers, making the company debt-free.

"The previous payments covered 80 per cent of farmers' dues; the rest will be settled now," noted Khang'ati.

An additional Sh150 million will cover three months' salary arrears for Nzoia workers, who are owed 24 months totaling nearly Sh1.8 billion.

Khang'ati said ongoing milling operations will ensure prompt payments and factory maintenance.

"AFA manages the Sh654 million to ensure transparency," he said.

="https://www.standardmedia.co.ke/business/business/article/2001480444/sugar-millers-crushed-by-sh117-billion-debt">The Nzoia Sugar Factory<, Board Chairman was optimistic that efforts by Agricultural Development Corporation (ADC) and National Youth Service (NYS) to plant sugarcane at the nucleus will ensure the miller operates at full capacity.

"The nucleus, dormant for long, now grows sugarcane thanks to ADC and NYS efforts, crucial for our stabilisation," Khang'ati stated.

Nzoia MD Hezron Kotut praised farmers for the increased sugarcane supply that has boosted the factory capacity.

"Sugar products are available in local markets, signifying our revival progress," Kotut said.