KAMPALA
The government has set a minimum sugarcane price of Shs125,000 per tonne.
This follows numerous complaints from farmers over low and inconsistent prices offered by sugar millers.
The decision was reached during a high-level meeting between sugar millers from across the country and officials from the Ministry of Trade, Industry and Cooperatives held in Kampala.
The intervention aims to protect farmers’ livelihoods, stabilise sugarcane supply, and avert social and political tensions in major sugarcane-growing areas.
Speaking after the meeting, the Minister of Trade, Industry and Cooperatives, Francis Mwebesa, said government stepped in after receiving numerous complaints from out-growers about arbitrary pricing by millers.
“Low and unpredictable sugarcane prices threaten farmer incomes, disrupt mill supply chains, and risk social and political instability in sugarcane-growing regions,” Mwebesa said.
He emphasised that sugarcane pricing should be determined through the Sugar Industry Stakeholders Council, as provided for under the Sugar Amendment Act, 2025, and urged millers to strictly comply with the law.
However, millers say pricing challenges persist. Henry Kata, a representative of GM Sugar, explained that price variations stem from differing production and operational costs among millers.
“While the law provides a pricing formula, operational realities still influence what millers are able to offer farmers,” Kata said.
The State Minister for Cooperatives, Frederick Ngobi Gume, called on millers currently offering lower prices to immediately revise them upward to the agreed minimum of Shs125,000 per tonne for a two-month period.
He said the temporary measure would remain in force as the Sugar Industry Stakeholders Council conducts a nationwide review of sugarcane pricing.
“This interim adjustment is necessary to ensure social and political stability, especially during the current electoral period,” Gume said.
Echoing government’s position, the chairperson of the National Biofuels Committee, Daudi Migereko, said the ruling NRM government views sugar millers as key development partners and urged them to cooperate as consultations continue to stabilise the sector.
Millers present at the meeting, including representatives from GM Sugar, Yogesh Agri, and Kamuli Sugar, said they unanimously agreed to implement the Shs125,000 minimum price per tonne nationwide for the next two months.
The chairperson of the Sugar Industry Stakeholders Council, Rajbir Singh Rai, reiterated the need for full compliance with the Sugar Amendment Act, 2025, stressing that a clear and transparent pricing formula is essential for harmony within the sugar industry.
Despite the government intervention, farmers in Busoga say the new price still falls short of covering production costs.
Speaking to Newzzone Publication , the Busoga farmers’ representative on the newly inaugurated Sugar Council, Isa Budhugo, described the agreed price as inadequate, arguing that farmers need at least Shs160,000 per tonne to break even.
“Our calculations show that it costs farmers about Shs150,000 to produce one tonne of sugarcane. Settling at Shs125,000 means farmers will inevitably make losses,” Budhugo said.
Currently, sugarcane prices in the Busoga sub-region range between Shs100,000 and Shs120,000 per tonne, depending on the factory.
With the new minimum price in place, all sugar factories are expected to set their minimum buying price at Shs125,000 per tonne effective Saturday , December 20.