East African Business Week (Kampala)
Cedric Lumiti
21 January 2008
Against the backdrop of disruptions in sugar production in Kenya, there has been a massive stock and inflow of the commodity in what players in the sector fear could be an organised dumping cartel.
Stockists have excess quantities of the commodity and prices are yet to be affected by the souring inflation occasioned by intense fighting and investment uncertainty occasioned by the post election violence.
A number of containers stocked with the commodity have been intercepted at the Mombasa port with no claims of ownership the shipment in what appears to be an importation spree due to the reigning confusion.
The Kenya Sugar Board has already launched investigations into allegations that a cartel of business people in conjunction with a section of politicians are taking advantage of the confusion to import cheap sugar from the far east especially Brazil.
"Our investigations are leading to crucial information that large consignments of sugar have been dumped into the country. We expect to catch up with the faces behind it very soon," said Mr. Saulo Busolo the board chair.
At a press conference in Nairobi, Busolo said the vetted samples of the product had established that it failed to meet Kenyan standards and expressed fears that it could be harmful for human consumption.
"Most of this sugar does not meet our local standards and we fear for the health of the Kenyan consumers," he added.
The investigations by KSB are being conducted in conjunction with leading sugar miller Mumias Sugar Company with a view of retuning the commodity to the countries of origin.
Most of the consignments netted by the authorities bore writings disguising them as rice.
The dumping reports could critically hurt the Kenyan sugar industry which is already reeling under the yoke of underproduction with measure being undertaken to revive it after years of underperformance.
Kenya is already enjoying a duty free sugar importation safeguard from the COMESA region to fill the deficit and hopes to use the four year period to up its production to meet local demand.
Mumias sugar managing director, Mr. Evan Kidero displayed to journalist samples of the illegal sugar and said they had put in place detecting mechanisms both at the port of Mombasa and the El Wak boarder points where it is believed the consignments entered the country.
"We must protect the local sugar mills from dumping which has been a major setback. We are committed to reforms in the sugar sector and will do anything within our reach to meet these targets," said Kidero.
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