Kenya’s Sugar Sector Rebounds to New Highs After Restructuring
Kenya’s sugar sector recorded a strong recovery, with January-July output rising 44.5% year-on-year to 528,874 tonnes. July cane deliveries doubled to 1.013 million tonnes, supported by mill revivals and restructuring after the government wrote off about KSh117 billion in legacy debts and tax arrears.
Kenya’s sugar industry posted its strongest monthly output on record in July 2026, with production rising to 91,022 tonnes as cane deliveries crossed 1Mn tonnes for the first time.
- The milestone capped a broader recovery that has lifted January-July sugar output 44.5% YoY to 528,874 tonnes, supported by the revival of Mumias, the return of Nzoia, Chemelil, Muhoroni and Sony, and a sharp rebound in cane availability.
- Cane deliveries reached 1.013Mn tonnes in July, more than double the 501,604 tonnes delivered in July 2025 and above the previous monthly record of 998,010 tonnes set in June.
- The wider restructuring followed the government’s write-off of about KSh117Bn in legacy debts and tax arrears owed by public sugar mills, alongside settlement of farmer and employee arrears.
Cumulative deliveries for the first seven months of 2026 stood at 5.94Mn tonnes, up 44.2% from 4.12Mn tonnes over the same period last year.
Finished sugar output has tracked the rise in cane almost directly. Production rose 115.4% YoY in July from 42,255 tonnes and increased 134.0% YoY to 89,709 tonnes in June. January-July output of 528,874 tonnes was also 12.9% above the comparable 2024 level and more than double production in the first seven months of 2023.
The recovery has coincided with the return of milling capacity that had been idle or operating below potential. Mumias Sugar’s operating business, now run under a lease arrangement by Sarrai Group, processed 638,086 tonnes of cane in 2024, up 230% from 193,377 tonnes a year earlier. The government subsequently leased Nzoia, Chemelil, Muhoroni and South Nyanza Sugar Company to private operators, returning four major state-owned mills to production.
Those four factories have combined installed milling capacity of about 11,200 tonnes of cane per day, according to Treasury disclosures, adding demand for cane and increasing national crushing capacity.
The wider restructuring followed the government’s write-off of about KSh117Bn in legacy debts and tax arrears owed by public sugar mills, alongside settlement of farmer and employee arrears. The Sugar Act 2024 also re-established the Kenya Sugar Board as a standalone regulator and created the Sugar Development Fund and Kenya Sugar Research and Training Institute.
A 4% Sugar Development Levy took effect in July 2025, with 40% of collections earmarked for cane development and productivity, 15% for factory development and rehabilitation and another 15% for research and training.
The production gains are already feeding through to the domestic market. Kenya Sugar Board data show sugar imports fell 52% month-on-month in July while closing stocks increased 14.3%. The regulator reported an average retail sugar price of about KSh155 per kilogram, with the minimum cane price at KSh5,500 per tonne.
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Source : The Kenyan Wall Street
