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40 sugar importers issued with permits, regulator reveals

By Kepher otieno | August 5th 2016

The Government has licensed 40 sugar importers, Sugar Directorate chief executive Andrew Osodo has disclosed.

The regulator, formerly known as the Kenya Sugar Board, had suspended the issuance of the import licences in January this year to check against excess supply of the commodity from the Common Market for East and Southern Africa (Comesa).

Thursday, Osodo confirmed they were now issuing new sugar import licences and that they had already approved permits for 40 traders.

"Those whose licences expired in January were asked to wait until June when we shall have reviewed import licences upon receiving report on stock analysis from the millers on the deficit needed," he said

Agriculture Fisheries and Food Authority (AFFA) Director General Alfred Busolo had suspended sugar imports to protect millers from unfair global competition. The regulator was forced to cut imports by 20 per cent in January this year in an effort to protect the millers from excess supply of cheap imports from Comesa countries.

Traditionally, the sugar importers are allowed only to import the difference based on the deficits realised in the production of the commodity by local sugar firms to avoid oversupplies.

According to Busolo, the initial stocks had surpassed the target, hitting 15,000 metric tonnes above the required 12,000 metric tonnes, which affected the miller's cash flow. But now sugar stocks have since dropped to 9,000 tonnes, making the regulator to sanction new imports to bridge the shortfall.

The country produces 630,000 tonnes of sugar a year, compared with an annual consumption of 900,000 tonnes. The deficit is covered through the strictly controlled imports from the Common Market for East and Southern Africa (Comesa).

The sugar industry officials reiterated the Government's commitment to revamp the industry, which was arguably one of the key sectors contributing significantly to the country's gross domestic product.

There are 250,000 small-scale sugarcane farmers who supply over 80 per cent of cane to the factories. The balance is supplied by large-scale sugar factories. Industry analysts say promotion of intensive cane farming by smallholder farmers was meant to help reduce poverty, given that more than 6 million farmers earn their livelihoods from cane growing.

Sugar is a major source of food, a pharmaceutical additive and sweetener, besides being a source of nutritive energy.

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