The government has adjusted the minimum cane price upwards and directed millers to adhere to the new rates effective April 1.
The review of the minimum recommended cane price to be paid to the farmer was arrived at by the Sugarcane Pricing Committee owing to the prevailing high sugar ex-factory prices over the past three months in Kenya.
The adjustment means a farmer will be paid Sh4,040 per tonne, up from the Sh3,700 per tonne minimum millers have paid since 2018.
In a statement delivered from Kilimo House, Nairobi on Tuesday, the Agriculture Cabinet secretary asked any farmer being paid less to report to the Agriculture and Food Authority (AFA).
“Any cases of non-compliance will attract a fine of not less than Sh500,000 or one-year imprisonment as per Section 37 of the Crops Act, 2013,” he said.
At the same time, a new model of paying cane deliveries based on quality is set to replace the century-old system that paid in terms of tonnage.
In the statement that dwelt on a wide range of issues in the sugar industry, Munya also said that a roadmap for implementation of the Quality-Based Cane Payment system is at an advanced stage.
“We hope to roll it out in July 2021,” he said, adding that the system will, among other things, serve as an incentive for high quality management in the production process.
This comes at a time the industry is experiencing sustained growth in acreage under the crop as well as output.
The total area harvested in 2020 expanded by 26 per cent to 89,803 hectares compared to 71,935 hectares in the period January to December 2019, the CS said.
“The Sugar Industry has witnessed a steady increase in sugar production due to enhanced investments by both Government and private players. In 2020, a total of 603,788 metric tonnes of sugar was produced compared to 440,935 metric tonnes in 2019. This signifies an improvement of 37% in local sugar production,” he added.