Farmers halt supply of sugarcane to mills

Sugarcane farmers have stopped supplying sugarcane to mills over low prices.

The chairperson of the Uganda Sugarcane Outgrowers Association, Mr Isa Budhugo, said the decision was informed by the low purchase prices of sugarcane offered by the millers given the high cost of production.

Farmers cite several challenges they face in sugarcane growing, including high labour costs.

“On March 15, we stopped supplying sugarcane. We want millers to increase the prices of sugarcane to Shs200,000 so that we can cover the costs incurred. We need more money because we spend a lot,” he said.

Currently, a tonne of sugarcane costs between Shs165, 000 and Shs170, 000 from Shs240,000 late last year.

Mr Budhugo said he invited the millers for a meeting on March 4, but none showed up.

“We wanted to engage them so we could come to an amicable solution,” he said.

Mr Budhugo said last week, millers were planning to reduce the purchase price of sugarcane to Shs140,000 yet they are making a lot of money from all its products.

“Let millers be considerate to our calls to increase the prices of sugarcane because they make more products out of it such as molasses, bagasse, ethanol, and fertilisers,” he said.

The chairperson of the Constitution Committee of Busoga Sugarcane Outgrowers Association, Mr Godfrey Naitema, said millers never consult them when increasing the price of sugarcane. He is afraid that this could drive them out of business.

“They are selling us seed cane at Shs250,000 per tonne, which is way too high,” he said.

Mr Naitema said factories such as Kakira are currently using sugarcane from its nucleus estates, unlike other mills, which are now struggling to source the raw materials.

Kakira Sugar Limited makes sugar from cane grown on 9,500 hectares of its nucleus estate, as well as an additional 7,000 hectares in its satellite projects, with the balance of cane being supplied by more than 10,000 out-grower farmers.

Although Kakira has its nucleus estate, it is currently running announcements on local radio stations in Busoga Sub-region, asking farmers to take their sugarcane to its mill because production is ongoing. In the first week of March, sugarcane farmers in Uganda gave millers two weeks to increase the prices of raw cane lest they cut their supply but they paid a deaf ear.

The Uganda Sugar Manufacturers’ Association (USMA), Mr Jim Kabeho, recently attributed the reduction in the purchase prices of sugarcane to too much sugar that is smuggled into the country from Kenya.

“There is too much sugar entering the Kenya border illegally at lower prices. Consumption of our sugar is very low, so once its prices go down, cane prices will also be at risk,” he said.