Kyambadde meets sugar millers over high sugar prices

FILE PHOTO: Amelia Kyambadde flanked by Jim Kabeho Mwine (in a blue tie) addresses a press conference at the ministry. PHOTO BY GODFREY SSALI

Kampala, Uganda | GODFREY SSALI | Sugar millers under their umbrella association the Uganda Sugar Millers Association have denied allegations they are hoarding sugar so as to sell it at higher prices.

Trade Minister Amelia Kyambadde summoned the sugar millers to a meeting Tuesday 5th December 2017 at the Ministry offices in Kampala after MPs vowed to table a motion on the floor of Parliament over the continuous high sugar prices.

The minister tasked the millers including Kakira Sugar, Kinyara, Lugazi Sugar and others to explain why sugar prices are still high yet they claim they have enough stock.

The millers led by their chairperson Mwine Jim Kabeho told the Kyambadde that sugar prices are not controlled by sugar millers but it’s totally in the hands of wholesalers and retailers.

They said factory prices have reduced from shs.198,000 per bag in June 2017 to the current sh 170,000 leading to retail prices going down to sh 4,000 and below in some areas.

“The recommended retail price by the millers is sh 3600 and some areas sh 3400, therefore on average retail prices should not go beyond sh 4,000 for premium or packed sugar�, explained Kabeho

Kabeho added that sugar prices are driven by sugarcane prices, farm yields and factory recoveries. He says lack of mature cane for crushing has led to low production and low factory recovery.

The Minister implored the millers to prevail over the distributors to maintain the recommended wholesale price of shs 3,400 and the distributors to prevail on the retailers to maintain the retail price.

“I am tasking the sugar millers to come up with a maximum price for sugar but as Government our position is that the price of sugar per kilogram should not exceed sh 4,000�, said Kyambadde.

On the issue of importation of duty free sugar, Kabeho said that they have enough stock of sugar in Uganda that will take care of the festive season and there is no need for duty free sugar importation which if done would come with negative implication to the sugar millers and sugarcane out-growers.

Minister Kyambadde reiterated her statement and said Government has not taken a decision to reduce taxes on imported sugar.

Jim Kabeho: The recommended retail price by the millers is shs.3600. Retail prices should not go beyond shs.4,000 for premium or packed sugar

The millers reported to the minister the challenge of rampant sugar smuggling mostly coming from Kenya which is affecting the sugar industry in Uganda.

The millers explained that the smugglers are now repacking the smuggled sugar inot local company bags before selling to the market. So far Kakira and Kinyara have petitioned Government about the cases where their local bags are being used to repack smuggled sugar.

In response, Alex Ruhinda the Assistant Commissioner Customs URA confirmed that smuggling of sugar has indeed escalated with over 100 metric tonnes impounded in the past four months.

The highest volume impounded is 52.7MT that was smuggled through the border with DR Congo, 26.9Metric tonnes was smuggled through the western border of Katuna, Mirama hills, and 11.7MT smuggled through the eastern border. Most of this sugar comes from Brazil, Egypt, Rwanda, Kenya and South Africa.

The Ministry and the millers agreed to issue a joint statement to explain to the general public the sugar production levels, the current sugar stock, wholesale price per bag, the wholesale price and the recommended retail price.

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