Uganda: Sugar millers need issuance of sugar licenses halted

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The Uganda Sugar Producers Affiliation (USMA) desires an modification of the Sugar Act, 2020, halting all of the sugar licenses at present issued by the Ministry of Tourism, Commerce and Trade, pending institution of the Uganda Stakeholder Sugar Council.

Led by their chairperson, Jim Kabeho, the affiliation is anxious that a few of the licenses had been illegally issued, alleging that they neither complied with the 2010 Sugar Coverage nor the 2020 Sugar Act.

The Sugar Council would, due to this fact, intervene in making suggestions to the minister earlier than the issuance of licenses.   

“We agree that the minister would proceed to challenge licenses however with suggestions from the council; as soon as the Council is in place, it might probably put into place some laws,” mentioned Kabeho.

Kabeho and a gaggle of different sugar millers together with Kakira Sugar Ltd, Kinyara Sugar Works and Sugar Company of Uganda (SCOUL), appeared earlier than the Committee on Tourism, Commerce and Trade, on Monday, 15 January 2024 the place they submitted on the Sugar (Modification) Invoice, 2023.

He opposed the requirement within the present legislation for sugar millers to share proceeds from sugarcane by- merchandise with farmers at a charge of fifty p.c, terming it impractical and a deterrent to funding.

“It needs to be famous that this proportion offers a minimal worth and events are free to comply with a better sugar worth; if we’re to maintain the sugar trade in Uganda aggressive, the 50 p.c is already larger than the world extensive trade commonplace,” mentioned Kabeho.

The affiliation complained that the sugar market in Uganda is already low and uncompetitive within the area following low sugar costs in Kenya and Tanzania.

The committee famous that sugar cane worth paid to the farmers in Kenya and Tanzania per tonne is an equal of Shs155,000 and Shs150, 000 respectively.

In Uganda, a tonne of sugarcane ranges between Shs235, 000 to Shs240,000.

Consequently, the committee was knowledgeable that for 2024 and henceforth, Uganda won’t be able produce sugar for export.

The sugar millers mentioned sharing of by-products with farmers at a charge of fifty p.c complicates the already troubled market.   

“Our view is that such an announcement needs to be faraway from the Invoice as a result of it’s impractical to implement and could be a grave error leading to big losses to millers utilising by-products and benefiting who don’t utilise sugar cane by-products,” mentioned Kabeho.

The Kinyara Sugar Works Director, Rajbir Rai, was equally involved concerning the sugar trade’s declining manufacturing, inflicting worth rises.    

“Our cane worth just isn’t aggressive even regionally, we aren’t saying farmers shouldn’t profit from the by-products however the trade prices are going larger and better, the share to be shared from by-products shouldn’t be thought-about for any increments,” he mentioned.

The affiliation mentioned the sugar levy slapped on millers to finance the actions of the Sugar Council ought to rope in farmers too. They argued that burdening solely producers with the levy is unfair.   

The group additionally reintroduced the proposal of zoning of millers, suggesting that a person miller needs to be a minimum of 25 kilometres from the following miller, which MPs mentioned just isn’t within the Invoice.

“At any time when the dialogue on zoning begins, farmers struggle it regardless whether or not it’s good or unhealthy. I encourage the producers to search out out different methods of stabilising the trade with out zoning, “mentioned Hon. David Isabirye (FDC, Jinja North Division).

Committee chairperson, Hon. Mwine Mpaka questioned if producers who’re including worth to sugarcane by-products had been paying extra for sugarcane than those that don’t utilise the by- merchandise.

“The best could be to contemplate the by-products however the query is how do you apply the 50 p.c? Will you say that an organization making extra by-products ought to pay extra for sugarcane?” questioned Mwine Mpaka.

MP Godfrey Had been (Indp., Samia Bugwe County South) mentioned farmers weren’t proud of the 50 p.c revenue share from by-products as a result of some firms are incomes quite a bit from merchandise like ethanol and bioelectricity.

Distributed by APO Group on behalf of Parliament of the Republic of Uganda.


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