The government has intervened to save sugarcane farmers in Busia from losing millions of shillings to deadly predatory brokers who had taken over the business with the local miller Busia Sugar Industries (BSI).
The Busia Deputy County Commissioner Mr Douglas Kipchumba Rutto on Friday summoned the BSI management and the Western Development Initiative Association- (WEDIA) National Vice Chairman Joseph Barasa to iron out the issues which were threatening to ground the operations of BSI sugar factory at Busibwabo.
Barasa said: “ When I appeared before the Deputy Commissioner I stood my ground on all the critical explosive matters I had already raised in my letter to the BSI Managing Director Ali Taib and which was copied to Busia County Commissioner and Governor Sospeter Ojaamong.”
The other key personalities who were also petitioned on this matter were Agriculture Cabinet Secretary Peter Munya and Mr. Kello Harsama the director Agriculture Food and Fisheries Authority (AFFA) which deals with sugarcane matters.
During the meeting the DCC said the government will protect farmers against brokers and emphasized that BSI must implement the directives by Hon Munya who had earlier ordered millers to buy a tonne at Kshs. 4040.
He also raised concerns as to why BSI had asked broker to write commitment letters to supply the Company sugarcane at Ksh3500 per tonne contrary to the orders given by the CS.
He said the move raises very critical question as to whether BSI will buy cane from Farmers at Kshs. 4040/= as ordered and leave the one from brokers to be supplied at Kshs. 3500 something he said would hurt the farmers even more.
The DCC whose area of jurisdiction Busia Sugar directly lies under, blamed the BSI management for using brokers to exploit and frustrate farmers.
He said: “The government through my office will do everything in its powers to save cane farmers from these predatory brokers who are profiting from the mess.”
The DCC said his office was already planning for a stakeholders meeting to discuss in detail the wide range of issues affecting the sugar industry to arrive at tangible solutions and conclusions to be executed that can salvage and benefit the local cane farmer.
A letter dated April 12, 2021 and signed by one of the brokers whose name we have withheld reads in part: “It is my decision to supply BSI mill cane at Kshs. 3500 and nobody has forced me to reach this decision.”
That figure is down from the Kshs. 3700 per tonne they were charging the miller after buying it from framers at throw away price of between Kshs. 1500 to 2500 per the same.
This came after BSI management summoned them (brokers) to discuss prices immediately after Cabinet Secretary Agriculture ordered new mill cane prices at Kshs. 4040 that is when they arrived at Kshs. 3500, from Kshs. 3700
Therefore there are remote chances for miller to comply with the above question since the BSI admitted that when it was hit by an excessive glut of sugarcane supplies for milling since last year they veered from their official cane harvesting contractual programmes to their farmers to adopt a willing seller – willing buyer arrangement.
What is clear is the fact that with the Kshs. 3500 brokers have entered with millers, they are already undercutting the government’s recommended prices.
“There have been challenges that is when we adopted this arrangement because apart from transport, it was also saving the costs on the raw material received from or suppliers under this arrangement,” said the BSI Public Relations Manager Stephen Mula
In a letter to the BSI CEO dated April 1st, from and signed by the WEDIA boss said: “We hereby kindly but firmly request you to stop doing business in the above mentioned manner when the sugarcane farmers who are supposed to supply you with cane are abandoned with their crop rotting on their farms.”
“It is our desire that you immediately address the plight of the sugarcane farmers contracted to supply the raw material to your company and stop buying it from the above mentioned sources. This state of affairs is making hundreds of farmers from Busia County to lose hundreds of millions of shillings every month which they had invested in the production of sugarcane to supply to your factory for processing.”
Mr. Barasa questioned why the BSI factory is buying the raw material from brokers and smuggling from Uganda at the colossal expense of local sugarcane farmers who championed for their factory to be constructed in Busia even as the company was facing relentless legal challenges.
He had warned: “Therefore vide this letter/notice two weeks’ notice to stop the above mentioned activities; otherwise we will be forced to immobilize the operations of your factory in protest of our losses as farmers.”
That is because as you purchase cane from the above mentioned sources, the farmers in Busia County are stranded with sugarcane that was harvested but never transported to your factory for processing, therefore turning it into firewood demanding the miller to compensate the sugarcane farmers for their lost millions.