Mumias sugar production hit by cane poaching
Sugar miller Mumias has decried rising cases of cane poaching that has led to low production of sugar.
Mumias is struggling to get the amount of cane required to operate optimally, leading to poor sales.
Mumias Chairman Dan Ameyo said on Tuesday that the problem has been occasioned by previous years of poor pay to contracted farmers which saw may jump ship and supply cane to other companies.
“Once we have invested we expect to crash that cane ourselves. But now we have other millers who have come around, flashing cash and going and picking cane where they get it without investing in its developments,” Mr Ameyo said.
Kenya is divided up into five sugar zones with milers restricted to the area they can source cane from. However the licensing of new millers in some of the zones has resulted in constant wars and accusations of cane poaching.
With Mumias in the process of turning around its operations, a level playing field will be ideal to fast track a return to profitability.
“Mumias can withstand completion so long as the playing field is level,” he said.
Last year the government pumped in Sh1 billion shillings into Mumias, with the money largely used to pay off outstanding farmer debt.
Mr Ameyo said Mumias is seeking to raise more funds that will see the company increase the acreage under which cane is planted.
Mumias posted a half year loss of Sh1.58 billion with sugar sales rising to Sh2.9 billion. The troubled sugar miller received a further Sh1 billion from treasury in April to finance its ongoing restructuring efforts.
Mumias has already announced plans to lease out its water bottling plant, sent a number of staff packing as well as refurbishing its plant to cut losses.
Report by Fidel Odhiambo
For Citizen TV updates
Join @citizentvke Telegram channel
Video Of The Day: Treasury allocates Ksh 4.5 B for procurement of vaccines