Thousands of people working in factories producing unrefined and non-distilled sugar risk losing their jobs.
This comes after the newly created Sugar Directorate issued notices to close down more than 200 such factories.
Sugar Directorate Chairman Andrew Osodo said the targeted factories were operating without licences and milling non-contracted cane without the authority’s approval as is required.
“We have issued them with a fresh notice after the earlier one expired with little response from those managing the jaggery,” he said.
Mr Osodo said they were now planning to raid the factories and close those that have failed to comply with the regulations.
“Jaggery is a substitute for the millers and we want them to pay for an annual trade licence of Sh50,000 before they are allowed to operate,” Osodo said.
Less than ten mills have been licensed to operate.
The chairman said the factories were posting huge profits and wondered why they were reluctant to pay the traditional levy set by the regulator.
“We are serious and those who do not pay the dues will be locked out of the lucrative sugar business in the rural areas,” he said.
But some of the small-scale traders claimed that the licence fee set by the regulator was too high to attract and sustain the alternative milling business.
One of the industry players, Penina Paul, called for a review of the taxes to cushion them from closing.
“The fee is high and I fear for most of us who will have no alternative but to close down. Hundreds of people will lose their jobs if the taxes are not revised,” she said.
Meanwhile, a new cane pricing committee (CPC) has been set up giving the county governments an opportunity to nominate representatives.
Members of the committee include the director general of Agriculture, one representative from the governor’s office, the millers and one representative each from sugar research and the Ministry of Agriculture.
Others are drawn from farmers’ unions and the Office of the Attorney General.
The team is set to hold their first meeting this week in Nairobi to review cane prices.
This is the first step that could see governors from cane-growing regions have a say in the management of sugar matters.