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Cane millers in Kenya to pay penalties for delays

COUNTIES
By KEPHER OTIENO | August 18th 2016

The Sugar Directorate says millers who delay in harvesting cane after it matures at 18 months will pay penalty charges.

Sugar millers will also be charged interest for delayed payments after harvesting, according to tough measures by the sugar regulator meant to enforce contracts in favour of farmers.

According to Sugar Directorate boss Andrew Osodo, management of sugar factories across the country will not be allowed to breach contracts.

Unlike in the past when cane farmers signed contracts but were reluctant to sue the millers when harvesting and payment was delayed, this time the Sugar Directorate has declared it will back farmers.

“We want our farmers to enjoy the benefits of cane growing and therefore millers who take advantage of farmers’ ignorance to delay harvesting and payments will face the directorate’s wrath,” said Mr Osodo.

He disclosed they were currently working on a viable mode of enforcing the new measures that are likely not to sit well with some millers.

“We will also enforce universal payment for cane per tonne, apart from ensuring that the crop is harvested on schedule,” said Osodo during an interview in Kisumu.

Minimum pay

Osodo said all millers will be required to pay farmers not less than Sh3,500 per tonne.

Meanwhile, Sony Sugar Company Chairman Ambrose Weda has announced increased payment for cane from the current Sh3,200 to Sh3,570 per tonne.

Mr Weda also announced the miller had scrapped the Sh1,000 penalty on burnt cane.

“Once we clear over-mature cane by end of September 2017, Sony will be fully back on track,” he said.

Most millers have not been harvesting cane within the stipulated cane contract arrangement.

As a result, a number of millers are currently losing millions of shillings to briefcase lawyers who take up farmers’ cases.

The trend has become so common that some of the millers’ vehicles are targeted by auctioneers.

Investigations revealed that Sony Sugar Company in Awendo was one of the major casualties, with lawyers currently demanding payments of successful cases.

The top management now fear if the trend continues, advocates will bring down the miller as they are demanding payments running into millions of shillings.

Already, more than Sh300 million has been paid by the company in such legal suits and this has not augured well with the sugar authorities.

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