2,500 sugarcane growers in Mayuge district have resolved to move their business from Kakira Sugar Company to its new competitor, Sugar and Allied Industries.
In a meeting over the weekend, the Mayuge District Sugarcane Growers Association said it was attracted by the benefits promised by Sugar and Allied Industries. The association resolved to immediately start supplying cane to the new industry when it starts its operations.
The promised benefits include cash-on-delivery for sugarcane supplies, access to interest-free loans and payment of all transport costs.
This move is bound to anger the management of Kakira Sugar Works, which recently wrote to President Yoweri Museveni to complain about the establishment of another sugar industry so close to its operations. The new factory will be located about nine kilometers from the edge of its operations.
In the December 15th letter, Mayur and Kamlesh Madhvani, managing directors of the Madhvani Group of Companies said the sugar policy requires that new factories are established in their own independent sugarcane cultivation areas. They said their company, Kakira Sugar Works, had spent millions of dollars developing an out growers scheme which would fail if Sugar and Allied Industries was allowed to operate in Jinja and Mayuge.
However the Ministry of Trade and Industry wrote back stating that government had no objection to the new factory.
Patrick Bampalana, chairperson of the Mayuge Sugarcane Growers Association, says his farmers are under no legal obligation to supply cane to Kakira Sugar Works. He says the farmers are responding to the realities of the industry in their choice to move their business.
Alex Ojambo, coordinator of Sugar and Allied Industries, says his company has ambitious plans for expansion that will benefit all sugarcane farmers. He says that in addition to the new factory in Jinja, it will establish several sugar cane collection centers around the region to ease supply and payment of farmers.
###
