Festive season to blame for rising sugar prices - dealers

Kampala. Consuming sugar is becoming a luxury for many people as prices go up, a scenario industrial experts attribute to festive season shopping speculation and mills producing below capacity.
In some suburbs in Kampala consumers are parting away with Shs4,000 to Shs5,000 to have just a kilogramme of sugar in their shopping baskets up from Shs3,500 it previously cost.
Mr Jim Kabeho, the chairman Uganda Sugar Manufacturers Association (USMA), in an interview with Daily Monitor yesterday, said: “The country is experiencing a shortage of sugar which is the reason why prices have been going up.”

He added: “This coupled with other economic fundamentals like the competition for the few raw materials (sugarcane) to produce sugar by the producers thus making them produce below capacity.”
He also shared that because of the festive season sugar being an ingredient used in the production of other products such as confectionary items it’s highly demanded and some speculators cause panic in the market.

“The festive season shopping rush could be behind the latest rise in prices,” Mr Kabeho said.
Dishonest practice
A sugar firm official who declined to be named said much as there was a drop in sugar production in the country, the scarcity of the product is as a result of an unending practice of businesspeople who buy Uganda’s sugar and take it to neighbouring countries for higher returns.
He said: “Some unscrupulous people are still diverting our sugar to Kenya and other East African countries whose needs exceed their production.”

Traders speak
Ms Brenda Ssekabembe, the proprietor of Bake for You, a cake baking outlet in Bunga, a Kampala suburb, shares that she buys a 50-kilogramme bag of sugar at Shs190,000 up from Shs170,000 barely a month ago.
“Because of this, we have been forced to increase our prices by about 10 per cent. This is a tough experience especially in a season like this (Christmas) which is peak,” Ms Ssekabembe said.
Capital Shoppers Supermarket managing director, Mr Ponsiano Ngabirano, too said sugar prices have been increasing but added that this is the matter producers have to explain.
Mr Ngabirano, however, said: “It’s not only sugar whose prices have gone up but even other commodities such as rice, maize flour and Matooke.”

Statistics
According to statistics from USMA, Uganda consumed about 350,000 metric tonnes last year but this is expected to increase to 360,000 tonnes this year judging from the demand.
Last year the country produced 418,882 tonnes of sugar of which 31,299 tonnes were exported to the region.
The surplus the country produces is exported to Kenya, Rwanda and South Sudan.

Number of players
Uganda has a total of 23 registered sugar producing companies among which are G.M Sugar Ltd, Uganda Crop Industries, Mayuge Sugar Ltd, Seven Star Sugar Ltd, Kinyara Sugar Ltd, Kakira Sugar Ltd and Kaliro Sugar Ltd.
The last time a kilogramme of sugar cost Shs5, 000 and above was in 2011 during the economic crisis. But on average the price has been oscillating between Shs2, 500 and Shs3,000.

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