Kenya’s sugar sector records gains as production, farmer earnings rise

Government reforms in Kenya’s sugar sector are beginning to translate into higher production, stronger farmer earnings and lower retail prices, as efforts to reduce input costs and revive struggling factories gather pace.

The reforms have focused on making farm inputs more affordable, increasing sugarcane production, improving factory operations and ensuring farmers receive better returns for their produce.

In Teso South, farmer Violet Otwane says the cost of a 50kg bag of fertiliser has fallen from as much as Sh7,000 to about Sh2,500. Improved cane prices have also encouraged farmers to consider returning to sugarcane production.

Sugar production rises sharply

The recovery has been reflected in national production figures.

Government data shows that sugar production increased from 472,773 tonnes in 2022 to 815,454 tonnes, while the area under sugarcane expanded by 19.4% to 715,693 acres.

The sector also received a new legal framework through the Sugar Act, 2024, which re-established the Kenya Sugar Board and provided a framework for regulating and developing the industry.

State-owned mills get private operators

The government has also sought to revive state-owned sugar factories through private investment.

Nzoia, Chemelil, South Nyanza (SONY) and Muhoroni sugar mills were leased to private operators for 30 years.

The leases are intended to inject fresh capital into the factories, support rehabilitation, improve operations, restore cane intake and increase capacity utilisation.

The revival of the mills is expected to provide farmers with more reliable markets for their cane while helping restore activity in sugar-producing regions.

Farmers earn more from cane

The increased production is also reflected in farmer earnings.

Cane farmers earned an estimated KSh33.5 billion in the seven months to July, while cane deliveries rose to 5.94 million tonnes from 4.12 million tonnes during the comparable period.

Estimated farmer earnings increased by 52.3%, while the average price of cane rose to KSh5,643 per tonne from KSh5,343.

The higher deliveries have also contributed to a significant increase in domestic sugar production.

Production reached 528,874 tonnes in the seven months to July, representing a 44.5% increase from the 366,007 tonnes recorded during the same period a year earlier.

Cane deliveries reached 998,000 tonnes by June before rising to a record 1.01 million tonnes in July.

Sugar production in July alone stood at 91,022 tonnes, more than double the 42,255 tonnes recorded in July 2025.

Sugar prices ease for consumers

Consumers have also begun to see the impact of increased domestic production.

The average retail price of sugar fell by 3.1% to KSh167.02 per kilogramme from KSh172.36 during the comparable seven-month period.

The decline comes as domestic production improves and factories increase their processing capacity.

Bura sugar project expands production

Further growth is expected from the Bura Irrigation Scheme in Tana River County, where a 50,000-acre sugarcane estate is being developed.

The project is expected to produce about 1.2 million tonnes of sugarcane annually and generate approximately 120,000 tonnes of sugar.

It is also projected to produce about 13 million litres of ethanol and 25MW of electricity from bagasse.

Beyond production, the project is expected to create about 3,000 direct jobs and provide a ready market for more than 10,000 smallholder farmers.

Farmers call for further improvements

Despite the gains, farmers say more needs to be done to ensure improved sector performance translates into higher net incomes at farm level.

Farmers interviewed have acknowledged improvements in fertiliser prices, factory operations and payment timelines but have called for greater attention to harvesting, transportation and other production costs.

They argue that reducing these costs would allow them to retain more of the income generated from higher cane prices.

The developments point to a sugar industry undergoing significant changes, with higher cane deliveries, increased farmer earnings, rising domestic production, expanded acreage, revived factory activity and lower retail prices.