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New technology best way to give sugar sector teeth

EDITORIAL
By -Editorial | January 20th 2014

-Editorial

Sugar companies set to begin production in the Trans Mara region of Narok County and in Kwale County are changing the game in a manner that gives Kenya a chance to fight off competition from Comesa. Until their entry, sugar producers from Sudan, Zimbabwe, Malawi and Swaziland were set to flood the Kenya market with their produce.

 The joker in the pack has been the continued failure of Kenyan sugar firms to bring down their production costs to match those of their competitors. Although the local companies have a litany of reasons why their sugar cannot compete against the imports from the Comesa countries, the key one is long maturity of the local sugar cane varieties.

 Interestingly, the new comers are either growing or set to grow varieties that mature in half the time — between 11 to 14 months compared to those currently grown in the sugar belt that take between 18 to 24 months.

Another less publicised but well-known fact is that Kenyan sugar fields produce an average of 60 tons of sugar cane per hectare which translates to about half the productivity in the Comesa countries.

 The net result is that Kenya’s production costs are about Sh60,600 per tonne of sugar compared to Sh26,100 in Zimbabwe, Sh26,950 in Malawi, Sh29,500 in Swaziland and Sudan. These massive differences explain why Kenya sugar companies cannot stand competition from these countries were they to be allowed to export their produce here as freely as the regional trade treaty demands.

 It also explains why the local sugar firms are living in trepidation as the deadline for the end of special exceptions approaches next month. But thanks to new investors in the industry; the country will not be swamped by imports because new factories have a few other cards up their sleeve.

 Their latest production technology will ensure an up to 39 per cent reduction in production costs. The new technology also gives the new firms the option of producing electricity not only for their own use but also for sale to the national grid.

 The old sugar companies face a bleak future, however, and unless the local leadership moves quickly to save the situation, the entire region could be plunged into poverty. But, first, the leadership—especially in the counties—has to agree the time for talking is over and decide to walk the talk of development.

 Undoubtedly, the entire region has huge agricultural potential as borne out by the large number of people concentrated in the two counties. This means that farmers can easily switch from sugar cane to other crops, with surprisingly welcome results.

 Mumias Sugar Company, for example, is showing the way by spearheading the rearing of grade cattle for milk.

 These efforts could be supplemented with the growing of horticultural crops for the local, regional and international markets. Farmers engaged in these two sub-sectors can easily testify that they make more money than those growing sugar cane.


 

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