A national sugar reserve will solve price issue

Monday July 27 2020



Five years ago to this day, the government showed so much interest in supporting the country’s economic backbone of agriculture that the Office of the Prime Minister offered one million hand-held hoes and 170 tractors for distributing to farmers. It was election year then as it is now.

Fast-forward and farmers are confronted with falling gate prices of maize grain at the private aggregating centres in Teso sub-region as the harvesting period gets underway.

In Kaberamaido District, the price in the recent two weeks has fallen to Shs550 per kilogramme, down from Shs1,400, according to a report by this newspaper.
In Serere District, the prices have crashed from Shs1,500 per kilo to Shs500.

Farm produce price crash is almost a given. A few years ago, a kilo of maize was selling for the price of a lollipop. But it is a totally different ball game for sugarcane farmers, especially in Busoga sub-region where the majority are concentrated. The continued drop in prices for cane is alarming.

A tonne of sugarcane further dropped to Shs99,000 last week, from Shs104,000 it was reduced to in mid-July. It had been selling for Shs110,000 a tonne.

Millers cite low sales that have impacted the price per kilo of sugar. With some regional countries banning sugar from Uganda, the millers find themselves with stock they would sell at lower price and take much longer to dispose of.


Ultimately, this price drop trickles down to the farmers, except that unlike millers who can engage in value addition of sugar or even store the bulk of it until the price stabilises, farmers hardly have such options.

The longer sugarcane stays in the farm after its maturity, the more weight it loses, leading to less tonne per acreage after harvest.
This leaves the more than 20,000 large scale farmers in Busoga in a fix. The farmers have urged government to buy and stock sugar from the millers. Besides stabilising the price per kilo, it would also save farmers losses.

But more importantly, it is time government put in place a national sugar reserve for not only the rainy days but also as a policy to cushion farmers from such losses.
In as much as there is fuel reserve and silos for maize grain, having a fully functional sugar reserve would balance the equation during both price crash and rise.
A government that spared Shs80b for hoes and tractors for farmers five years ago surely can do a little to step in before sugarcane farmers lose hope.

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