6,000 risk losing jobs as sugar miller faces closure

Muhoroni, Kenya: More than 6,000 people risk losing jobs should Muhoroni Sugar Company operations grind to a halt over failure to sell sugar.

An additional 20,000 cane farmers also stare at uncertain future over the developments.

The cash-strapped company is in dire need of Sh500 million bailout packages to pay debts owed to farmers, transporters and suppliers of spare parts.

 “If something is not done urgently, the company could halt its production by today. We will have no option since we are unable to sell sugar. Our stores are full. We are in a state of desperation,’’ said the company’s General Manger Anderson Oloo.

Currently, the miller has 30,000 tonnes of sugar worth Sh325 million while it owes farmers Sh270 million since February. The company also owes transporters Sh28 million and Sh370 million to suppliers of spare parts.

 This means that should the machines break down, the factory may stall since it cannot secure the spare parts.

With the stores full, the company has been forced to seek alternative storage facilities.

Mr Oloo said they only have two options, “either to stop production or look for alternative store in Miwani Sugar Company. But, if we are to resort to Miwani stores, then we will have to part with additional cost of Sh300 per bag. This will even make the final product expensive,” he said.

When The Standard on Saturday visited the company on Thursday, panic and uncertainty was written all over the faces of the workers as farmers made their way to the company to demand for their pay.

So far, some suppliers have stopped transacting business with the company until all their dues are paid.

“We cannot pay them since we have no money. The Government should come in to rescue the company,’’ said Oloo, adding that the Kenya Sugar Board should allow the company to sell the commodity at whatever price available in the market.

Though the company is working optimally and produces 150 tonnes of the commodity per day, Oloo said that since the week started, they have only managed to sell 1,300 bags, which is too low to ease the crisis. The sugar sector generates an estimated Sh12 billion annually.