The government has unveiled a Ksh 4 billion investment aimed at reviving Kenya’s ailing sugar industry, with the funds set to be sourced from the Sugar Development Levy (SDL). Agriculture Cabinet Secretary (CS) Kagwe made the announcement during a tour of West Kenya Sugar Company, which recently secured a 30-year lease to operate the troubled Nzoia Sugar Company.
CS Kagwe noted that 40% of the SDL approximately Ksh 1.6 billion will be directed towards cane development programs nationwide. The remaining funds will target key strategic areas in a bid to ensure the long-term sustainability of the industry. Specifically, Ksh 600 million (15%) will be used to rehabilitate roads in sugarcane-growing regions, while a similar allocation will support research and innovation to improve productivity. An additional 15% will go toward factory rehabilitation, 5% will strengthen farmer associations, and the balance will fund administrative operations under the Sugar Board.
“These investments are designed to secure the long-term sustainability of the sugar industry,” Kagwe stated, adding that the allocations follow extensive consultations with farmers’ unions and millers.
The CS praised West Kenya Sugar, owned by the Rai Group, for its farmer-focused approach, including weekly payments to over 120,000 contracted farmers and consistent monthly wages for employees. The company disburses over Ksh 14 billion annually to farmers and invests Ksh 7 billion each year in cane development.
According to the Agriculture and Food Authority (AFA), as of September 2024, nearly 50% of all land under sugarcane cultivation in Kenya is managed by Rai Sugar Group, illustrating its significant footprint in the sector.
To curb the issue of cane poaching, Kagwe urged farmers to stay loyal to mills that support them and directed the Sugar Board to establish clear zonal boundaries to minimize conflict. He also encouraged farmers to wait for cane to mature fully before harvesting to enhance sugar quality and competitiveness on the global market.
Kagwe also visited Butali Sugar Mills in Kakamega County as part of a wider evaluation of private sector participation in ongoing sugar sector reforms.
