Doubts about Uganda's ability to sell cheap sugar to Kenya hard to dispel

In his recent visit to Uganda, President Uhuru Kenyatta is reported to have signed a trade agreement with his host, Uganda’s President Yoweri Museveni, allowing the importation of sugar from Uganda to Kenya. The CORD leader, former Prime Minister Raila Amolo Odinga, questioned this agreement, arguing that at a time when Mumias Sugar Mills— and indeed all other sugar factories — is on its knees requiring a bail out by the government, it would be counterproductive to allow into the market “cheap sugar” from Uganda rather than seek to revive our own industries, making them efficient and competitive within the COMESA market. President Kenyatta, on his part, retorted that rather than import the “cheap sugar” from Brazil, he would rather get it from his brothers and sisters across the border in Uganda. The million dollar question is: Is Uganda currently in a position to export “cheap sugar” to Kenya? Let us look at the facts.

According to Uganda government’s official figures, the total projected production of sugar in Uganda in the year 2014/2015 is 447,000 metric tonnes. The projected consumption, on the other hand, is 420,966 metric tonnes; leaving a surplus of 26,034 metric tonnes. These figures, however, were projections at the beginning of the financial year. An article by Nicholas Kalungi in Uganda’s “Daily Monitor” on August 12, 2015, stated as follows: “Unless local sugar production capacity is increased, consumers will continue paying high prices for the commodity. This comes after the operational sugar companies such as Lugazi, Kakira and Kinyara—among others—failed to meet the 2012 sugar production forecast.”