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Sugar Manufacturers Call for Application of Zoning Policy

As millers compete over sugarcane when demand for sugar at local and international markets is said to be increasing, players in the industry have again called on government to revert to the implementation of the sugar mills zoning policy to avoid undue scramble for sugarcane.
14 Feb 2017 19:38

Audio 2

The Sugar industry is under a tight spot due to shortage of sugarcane, the basic raw material for Sugar production. 

As millers compete over sugarcane when demand for sugar at local and international markets is said to be increasing, players in the industry have again called on government to revert to the implementation of the sugar mills zoning policy to avoid undue scramble for sugarcane.

The policy recommends that sugar factories are established within a radius of at least 50 kilometers from one another. But according to Uganda Sugar Manufacturer's Association, the industry has not been well regulated leading to collusion and distortion of the out grower systems on which old factories have survived for sugar cane.

The scramble has in the past years been confined in Busoga and parts of Buganda with the emergence of new sugar mills around Kakira and Lugazi. But Kirunda Magoola, the Corporate Communications Manager with Kinyara Sugar Works says that Kinyara, which has thrived around its 6000 out grower system, is already at threat.

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Magoola says investors seeking to enter the sugar manufacturing market should be encouraged to open their business in underutilized sugar cane growing areas for the industry to grow.

One of the challenges the old sugar players are facing is that they cannot force farmers to refund inputs and seed advanced to out growers that decide to sell the competitors.

Kinyara Sugar according to Magoola gives sugar cane growers fertilizers, cane seed, costs of tilling land, and harvesting. The expectation was that they would supply the product to the factory. But Magoola says that Kinyara has lost 1600 hectares of cane through such dubious dealings in the last eight months.

Dr Ibrahim Mike Okumu, who has studied the sugarcane out grower system in Uganda, says the existing Sugar Control Act 1938 is inadequate and does not the current challenges in the industry.

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A new National Sugar Policy has been in place since August 2010 but it has not been enforced. The policy says Sugarcane growing areas shall be planned within a radius of 25 kilometers and that new sugar mills shall not be licensed within 25 kilometers radius of an existing mill.

The Ministry of Trade and Industry has also drafted the Sugar Bill as part of the efforts to regulate the sugar industry. The bill once enacted into law will have the creation of the National Sugar Board charged with among others issues streamlining the industry.

The policy also says 30 percent of the area within that radius shall be used for cane growing and the remainder of the land shall be reserved for food security and other activities.

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