Workers arrange packets of sugar on a convoy belt at Mumias sugar factory. [Photo/Kenyawallstreet.]
Stocks of sugar being held by the factories has risen by 42 percent to hit 11,427 tonnes from 8,009 tonnes within a span of two weeks, highlighting the negative impact of sugar imports on millers.
According to the statistics from the sugar directorate, the sudden growth in the volumes of sugar held by factories has pushed the sugar prices down with a 50-kilogramme bag currently going at Sh3700 from Sh,000 last week.
“From the look of things the stocks will rise to about 15,000 tonnes in the coming days,” said the Agriculture and Food Authority (AFA) director-general Alfred Busolo.
The latest trend implies that the millers are grappling with low sales of sugar considering that majority of wholesalers and supermarkets ~ who act as main distributors are opting for the cheap imported sugar.
The previous data from the Directorate showed that traders imported 300,000 tonnes of sugar in the month of August ahead of the August 31 expiry of a waiver on cheap sugar from Brazil amounting to highest sugar imports in the last five years.
The imports however aided to reduce the high sugar prices that were being witnessed in the country as a result of the sugar shortage brought by the drought that hit the country earlier in the year cutting the sugar production by 49 percent.
Last week millers pleaded with the AFA to reduce the price of cane from the current Sh4,025 per tonne to Sh3,000 following the low customer purchase but AFA declined the request.