The Star (Nairobi)

15 November 2012

Kenya: Farmers Laud Sh2 Billion Sugar Fund

Sugar cane farmers in Western Kenya yesterday praised the setting up of a Sh2 billion fund by two state corporations from which they will draw loans for farm inputs bought at reduced interest rates.

The loan scheme is the result of a joint effort by Agricultural Finance Corporation and Kenya Sugar Board. The draft contract is being studied by Attorney General's office before its adoption.

Cane farmers will borrow from the fund at only five per cent interest as opposed to above 15 per cent charged by commercial banks.

Nzoia Outgrowers Company chairman Joash Wamang'oli and Kenya Sugar Cane Growers association CEO Waswa Mungo said the move by AFC and KSB "is progressive because it will free growers from depending on millers who exploit them."

The duo said with farmers access to cheap credit from the envisaged fund, they will be able to sell their cane to choice millers paying "the right price for cane and eliminate poaching wars now raging between sugar millers in Western Kenya among them Nzoia, Mumias, Butali and West Kenya sugar companies".

"Until now, it is the millers who have been financing purchase of farm inputs in the sugar belt at terms they dictate leaving the farmers in their stranglehold-unable to sell cane out of certain zones even when prices are higher out there," Kesga executive committee member Lucas Watta observed yesterday.

KSB chief executive Rosemary Mkok says the move to set up the fund was aimed at increasing productivity in Kenya's sugar belt and reduce incidents of cane poaching by making farmers independent from millers so they could freely choose buyers of their cane product.

Details from AFC indicate that farmers will be able to borrow sh52,000 per every acre of sugar cane and pay back with a five per cent interest once the initiative to liberalize cane growing kicks off.

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