Nzoia Sugar Company has released Sh153 million, being part of a Sh579 million debt owed to farmers as it seeks to appease them ahead of plans to jump-start its operations next year.
The firm says it will also clear another Sh175 million owed to farmers who supplied cane between November 2018 and October 2019.
“The payment is timely since it will contain the cane poaching menace which had become rife following delayed payment concerns,” said Michael Makokha, the company managing director. He disclosed that the government in March paid Sh426 million to 12, 292 farmers and second batch of 4, 977 farmers are still waiting for their dues.
“The company has put in place strategies to ensure that the remaining Sh175 million for farmers who supplied cane to the factory from November 2018 to April 2019 is cleared as soon as the factory operations resume,” Mr Makokha explained.
“The ongoing factory repairs are at advanced stages and crushing will start soon,” Mr Makokha said while assuring farmers of prompt payment. This comes as most sugar cane companies in Western Kenya region reduce their crushing capacities to cushion against losses owing to market challenges, subjecting farmers to delayed harvesting of mature cane and consequent high production costs.
“Inadequate crushing capabilities at factory level and ageing equipment and technology that are not efficient are some of the challenges facing sugar cane farmers in the region,” Moses Baraza from the Nzoia sugar belt.
Most factories pay less than Sh3,000 per tonnes of sugar cane which the farmers consider to be too low.
“Ii is no-longer profitable to invest in the subsector to the unstable market and declining producer prices,” said Joshua Maina from Turbo, Uasin Gishu County who six years ago diversified to sugar cane production.
The Nzoia Company has however unveiled fast maturing crop production using farrow irrigation to address cane shortage.
The company in the recent past been grappling with acute shortage of seed cane but hopes the new measures will shore up production and sugar volumes.
The firm is milling less than 2,000 tonnes of cane a day against an installed capacity of 3,000 tonnes, according to the management.
The irrigation system of sugar cane production has proved prosperous in sugar cane producing countries including Sudan, Egypt and Uganda by boosting the yield.
In Egypt, almost 8 million acres of sugar cane plantation is under irrigated agriculture as compared to 350,000 acres of sugar cane in Kenya which is placed under rain fed agriculture.