By John Kyule
Production Bounces Back, Prices Ease Slightly
June 2025 brought welcome signs of recovery for Kenya’s sugar industry after months of contraction and price escalation. The latest Kenya Sugar Board newsletter captures this pivotal moment, as production and by-product volumes rebounded, market prices moderated, and import reliance began to ease.
Production Rebounds After Months of Decline
For the first time in several months, total sugarcane milled recorded a substantial 25% increase compared to May, with most operational mills registering improved activity. Sugar production responded in kind—up 18% from the previous month—highlighting the sector’s resilience even as several key mills (including KISCOL, Naitiri, Chemelil, Nzoia, and Muhoroni) remained closed.
Molasses output also rose by 25%, and sales surged 48%, signaling a strong market for by-products as the mid-year progressed.
Market Dynamics: Prices Soften Amid Higher Output
With improved supply, ex-factory and wholesale sugar prices finally retreated from their recent highs:
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Ex-factory sugar prices fell by 3% to Ksh 7,147 per 50kg bag.
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Wholesale prices dropped by 10% to an average of Ksh 7,221 per 50kg bag.
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Retail prices eased slightly to Ksh 171 per kilo, a modest 1% decline from May.
Sugarcane prices held steady at Ksh 5,500 per tonne, reflecting continued adherence to the minimum set price established in late May.
Supply Chains Reset: Stockpiles Grow, Imports Slow
Sugar sales by millers dipped 5%, but closing stocks more than doubled—rising 86% to 19,078 MT—offering a buffer against future volatility and marking the highest stock levels seen in several months.
As local production rebounded, Kenya’s sugar imports fell sharply to 38,371 MT (down from 53,447 MT in May). Both mill white/brown and refined sugar imports declined, and import prices (CIF values) reflected some relief compared to earlier in the year.
The molasses market also saw a reset, with closing stocks falling as sales picked up. Small volumes of molasses imports continued, mainly from Uganda.
Global Sugar Market: Prices Continue to Slip
Internationally, the average ISA Daily Raw Sugar Price slipped further to 16.74 US cents/lb, extending the downward trend seen since March and echoing a period of softer global pricing.
In Summary
June 2025 marked a turning point for Kenya’s sugar sector. After months of declining production and rising costs, the industry showed renewed strength, with output up and prices stabilizing. This offers cautious optimism to growers, millers, traders, and consumers as the market moves into the second half of the year.
Explore the full June 2025 Sugar Market Newsletter for detailed production data, trade analysis, and the Kenya Sugar Board’s latest market outlook.