Sugar exports rise during crackdown

A ship offloads bags of sugar at the Port of Mombasa. FILE PHOTO | NMG 

In Summary

• Data from the Sugar Directorate indicates exports grew to 1,034 tonnes from 277 tonnes in the comparable period last year, representing a 273 per cent jump.
• May registered a significant growth with 1,003 tonnes exported at a time the government started confiscating contraband sweetener.
• Kenya is a deficit producer and most of the production is targeted at local consumers. At the same time, Kenyan sugar is expensive and therefore not attractive for export.

By GERALD ANDAE
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Sugar exports in six months to June grew nearly threefold, an indicator that some of the cheap imports flooding the market during the period might have been shipped out.

Data from the Sugar Directorate indicates exports grew to 1,034 tonnes from 277 tonnes in the comparable period last year, representing a 273 per cent jump.

May alone registered a significant growth with 1,003 tonnes exported at a time the government started confiscating contraband sweetener.

“Overall sugar exported in January – June 2018 were 1,034 tonnes against 277 tonnes in the same period last year,” says the report.

State agencies cracked down on illegal sugar with over one million kilogrammes confiscated.

Kenya is a deficit producer and most of the production is targeted at local consumers. At the same time, Kenyan sugar is expensive and therefore not attractive for export.

Kenya was last year accused by regional states of importing duty free sugar then selling products to neighbouring states.

The country has been at loggerheads with Tanzania and Uganda over the duty-free window gazetted last year allowed millers, traders and manufacturers to bring in the commodity outside the Common Market for Eastern and Southern Africa (Comesa) arrangement.

READ: Uganda mulls ban on sugar exports to Kenya

Kampala and Dar es Salaam argued manufacturers in Kenya were using cheap sugar in processing goods, and hence banned products such as confectioneries and chocolate from accessing their markets.

The Treasury scrapped duty on the commodity last year following a sharp decline in production that saw the price rise to Sh400 per two-kilogramme packet.

Kenya produces about 600,000 tonnes of sugar yearly against an annual consumption of 870,000 tonnes. The sugar deficit is usually covered by stringently controlled imports from the Comesa trade bloc where Kenya allows a quota of 300,000 tonnes.

Kenya has been granted a two-year extension after it made a request last week during the Comesa meeting held in Zambia. The new safeguards start next February once the current one comes to an end.

A joint committee comprising officials from Comesa will oversee the implementation of the extension on safeguards and make determination at the end of two years on whether to renew the quota.