By Sheela Tumaini
The Sugar Industry is a vibrant economic venture in the country’s agricultural setup, it is especially more crucial in the Nyanza and Western regions of the country. The industry empowers livelihoods and local economies through sugarcane farming, harvesting, transportation and employment. The sugar subsector has been undergoing significant reforms to ensure industry success through policies such as the 2023 Policy on Revitalization of the Sugar Industry. However, the sugar industry in the county is faced with significant and persistent challenges, which include inefficiency within the industry, lack of credit and input support for smallholder farmers, environmental degradation, poor technology uptake and a lag in sustainability enforcement, among others.
It is therefore important to consider a sustainable supply chain system within the industry so as to tackle the aforementioned issues for a more resilient industry. Hence, what follows is a functionality audit from farm and farmers, harvesting and transportation, to mills and the milling process and the distribution and sale of sugar. This will allow for the dissection of the industry through the lens of sustainability via its three pillars, namely: environmental, social and economic, ensuring the viability and success of the industry.
i. The Environmental Pillar
There are several ways that sugar farming may lead to environmental degradation. At the farm level, this may include pollution from the use of fertilizers and pesticides, poor farming practices, which lead to gradual soil degradation and the lowering of the water table, as sugarcane is a thirsty crop. Additionally, harvesting methods, such as the burning of cane and the emissions during the transportation process, can lead to pollution. At the mill level, improper waste disposal practices have also threatened environmental sustainability, with heaps of bagasse waste accumulating in mills, proving hazardous.
The industry has, however, made great strides in meeting a sustainable supply chain in the environmental sector. This is achieved through practices such as the production of biochar from bagasse, which helps improve soil health and reduce carbon emissions from the processing of bagasse at the mill level. Kibos Sugar Company has also been at the forefront of waste conversion of bagasse into biodegradable packaging materials. Trans Mara and West Kenya Sugar companies have cogeneration plans that use bagasse to produce renewable energy.
In this ever-changing global sugar industry dynamics, there is a need to integrate carbon-smart agricultural technologies, such as waste-to-energy conversion through take up of current industry innovations, green manufacturing, institutional support for value-addition initiatives and the formulation and enforcement of sustainability policies. This will help align the industry with UN standards of sustainability in the SDG goals.
The Social Pillar
Smallholder farmers produce about 93% of cane in the country, yet they face the most challenges within the sugar supply chain. Some of the challenges faced include, delayed payments, lack of proper financing/credit access, price uncertainties and fluctuations, industry inefficiencies and threat from the cheap imports. In addition, as of early 2026, the sugar industry experienced multiple strikes and protests from workers from various mills (the recently privatized ones), complaining of delayed payments. These failures can be attributed to poor governance structures within the industry, a lack of stringent enforcement of policies and political interference, which sees the breakdown of industry coordination within the industry.
To mitigate this, farmers and employees must be protected and their welfare taken care of by the mills, contracting companies and the government. This can be achieved by ensuring engagement, transparency and consideration of opinions in policy-making, timely and predictable payment, a review of the pricing systems within the country and proper execution of the stipulated policies in the Sugar Act 2024, especially those related to the Sugar Levy. Furthermore, the industry should consider the strengthening of outgrower societies that have previously proved to be efficient in connecting farmers to mills and offering financing solutions. This was especially evident during the glory days of Mumias Sugar Company, when farmers had a fully functional Outgrowers’ company (MOCO), whose collapse around 2008 left farmers exposed and closely coincided with the onset of Mumias Sugar's struggles and downfall.
Commendably, encouragement of the young population to actively participate and get involved in the ever-aging sugarcane farmers demography through forums like the Sugar Industry Innovation Symposium has been fundamental in enhancing innovation and take-up of sugar cane farming among the youth, opening room for community education, industry continuity and economic empowerment.
The Economic Pillar
The Kenyan sugar industry has experienced a number of structural problems that have affected the overall economic performance of the industry. This has inevitably led to a reduction in the yield of the crop, failures in the factory, problems in logistics, increased cost of production and overall inefficiency in the industry. This has resulted in the industry not being in a position to meet the local demand alone, not to mention meeting the demands in a competitive manner in the regional and global markets. This has led to the increased importation of sugar, which in turn threatens the economic sustainability of the industry.
In an attempt to solve this, the Kenya Sugar Board has set out to improve the country’s sugarcane yield to 85 tonnes per ha from the current average yield of 65 tonnes per ha, through its 2025-2027 Strategic Plan. This can be done through the implementation of strategies that include the adaptation of better agronomic practices, climate change mitigation strategies through climate insurance and the use of precision agriculture, enhanced soil health through soil analysis and soil improvement. Furthermore, there should be the implementation and scaling up of initiatives that include the adoption of high-yielding and fast-maturing varieties that have the ability to grow in different agronomic zones to improve yield.
In regard to efficiency in terms of factories and the high cost of production, the 4% Development Levy that is proposed will be useful in ensuring that the mills are rehabilitated in order to enhance their efficiency in meeting the maximum milling capacity. Additionally, the Levy will also be useful in the adoption of innovation and new technologies, which will help improve value addition and diversification of by-products to biofuel, renewable energy, green energy and cogeneration. This will thus enhance cane value and increase revenue for the mills.
Take Away
The country's exit from the COMESA Sugar Safeguard and the privatization of government mills are positive developments that will guarantee the country's competitive bone is triggered into standards that will enable regional integration. However, without rigorous adherence to policy frameworks and equitable and transparent implementation, this integration will not take place. The industry needs to be guided by a clear, forward-looking strategic plan that is backed by sufficient industry funding through initiatives like the Sugar Board's SDF, capable and responsible leadership and open stakeholder support. If all these can be properly executed, they have the potential to position our sugar industry as a competitive and sustainable player within the regional and global market.