Mumias Sugar Factory is run by part of Ugandan Rao family
The Uganda-Kenya sugar story takes another angle, with workers at a major miller, Mumias Sugar staging a protest against the Ugandan managers of the mill.
The protesters, among other issues, allege that the company was hiring Ugandans, hence reducing the job opportunities for Kenyans.
This comes just after information circulated in the Kenyan media that the country imported more than half of their sugar supplies from Uganda in the month of August this year.
The protesters accused the Ugandan-based Sarrai Group, which took over management of the Western Kenyan factory of refusal to pay their due salaries, as well as recruiting workers from Uganda.
In December 2021, Sarrai Group, a part of the Rao family, which also runs Kinyara Sugar, Hoila Sugar and Kiryandongo Sugar factories in Uganda under the name RAO Group, was awarded a 20-year lease of Mumias factory assets after the factory accumulated huge debts.
The company later run into problems after the high court revoked the lease to Sarrai on grounds that did not cater for the interests of Mumias shareholders and other lenders, and was only in famous of KCB.
Last month, the court of appeal gave Sarrai temporary reprieve to resume running of the company until the main case is determined.
The management promised to start paying their salaries accruing from the troubled seven months.
The protesters are questioning why this is not yet fulfilled, and have also asked President William Ruto to intervene and also cause the deportation of the Ugandan workers to their country.
Sugar trade
The import of more than 9,000 tonnes of sugar by Kenya is a drastic development considering that in July, there were no recorded shipments from Uganda to the eastern neighbor, as the country’s industry leaders pressed the government to stop the imports which were allegedly affecting local production.
However, the media reports that Kenya instead imported most of her sugar from countries Mauritius, Zambia and Zimbabwe in July.
The blockade of Sugar from Uganda by Kenya was one of the major stains of the economic relations between the two countries during the last five years of Uhuru Kenyatta that ended with the August 2022 elections. Others included poultry and poultry products, beef and dairy products that faced several bans by the Kenyan authorities.
In August, according to the data quoted by the Business Daily, Kenya imported from Uganda sugar amounting to 9,739 metric tonnes worth about 41 billion shillings (1.3 billion Kenya shillings, out of total imports of 17,590 tonnes.
The increase of Uganda’s exports to Kenya also coincided with a sharp rise in the prices of sugar from 3,500 shillings a kilo in mid-August to 5,000 shillings in October, with the Ugandan millers citing scarcity.
The Uganda Sugar Manufacturers Association say the scarcity is due to low cane supply as higher demand forced prices up from around 100,000 shillings a tonne to 170,000 shillings.
Robert Olego, a manager at the Sugar Corporation Uganda Limited, SCOUL said cane output dropped because in 2020, there were hardly any new plantations opened as the low prices discouraged farmers.
The country produces about 600,000 tonnes of sugar up from 550,000 in November 2020, following an increase in the number of millers to 18 currently.
It is believed that the close to 10,000 tonnes exported to Kenya in August, out of the monthly 50,000 average, helped push up the prices of the commodity.
Other major destinations of Uganda’s sugar are South Sudan and the Democratic Republic of Congo. Currently, sugar manufacturers in Uganda include the major ones; Kakira Sugar Works, Kinyara Sugar Works Limited, Sugar Corporation of Uganda Limited, Sango Bay Estates Limited and GM Sugar Uganda Limited.
The smaller millers, licensed after November 11, include Amuru Sugar Works Limited, Atiak Sugar, Bugiri Sugar Factory, Busia Sugar Limited, Hoima Sugar Limited and Kamuli Sugar Limited.
Others are Kenlon Industries Uganda Limited – Buyende, Kyankwanzi Sugar Works Limited, Mayuge Sugar Industries, Mukwano Sugar Factory – Masindi, Buikwe Sugar Works Limited, Sugar and Allied Industries Limited and Uganda Farmers Coop Industries Limited.
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