Uganda gets nod from Kenya to export more sugar

URN

Uganda Sugar exporters are to receive a permit for exporting another 20,000 metric tonnes consignment from Kenya next week. 

In an interview with URN, Trade minister Amelia Kyambadde revealed that this consignment is part of the 90,000 tonnes agreed upon by both governments. Kenya allowed duty free wholly obtained sugar from Uganda of up to 90,000 tonnes per annum on condition of submission of proof (that indeed it is grown and milled in Uganda). 

Minister Kyambadde says the export will continue in a phased manner as a control mechanism in the market. 

In 2020, Kenya announced a ban on all sugar imports and as a result revoked all sugar import permits, some of which were held by Uganda manufacturers and exporters due to the influx of imports in Kenya that negatively impacted sales of Kenyan sugar producers, leaving them with huge unsold stocks. But the dumping of foreign sugar by Ugandan smugglers has hurt the Ugandan sugar farmers most, with the sub-region of Busoga most affected.

Tanzania and Rwanda were the first to close out Uganda’s sugar followed by Kenya on claims that dealers were importing and re-exporting cheap sugar into their markets, which claim saw Uganda lose out on sugar exports ranging between 100,000 and 130,000 tonnes.   

As a result, border ware houses were suggested for easy monitoring and evaluation of Ugandan made sugar.   

“For Rwanda and Tanzania, the negotiations are still top level between heads of state” says Kyambadde. 

Uganda currently has stockpiles worth $45m (Shs168b), which have been building since 2019 as a result of blockades.

Kyambadde adds that more negotiations with Kenya will be handled in a meeting with her Kenyan counterpart between the 25th and 26th February 2021, to handle issues like the challenge of non-tariff barriers (NTBs) on sugar, poultry products and dairy products.

According to the data released by the Bank of Uganda, sugar exports have slid by 108b, representing a 35 per cent decline in earnings in the last three years.

Jim Kabeho, the Uganda Sugar Manufacturers Association chairman, says they are working towards finishing the first export consignment of 20,000 metric tonnes that was granted in December 2020. 

He greatly welcomes this consignment, saying it will surely reduce on the stockpiles. 

In previously interviews, Jim Kabeho said manufacturers had built capacity to produce about 550,000 tonnes of which about 370,000 tonnes are consumed locally.