Sugar millers in Busoga Sub-region are currently purchasing raw cane from farmers at prices ranging between Shs175,000 and Shs215,000 per tonne, marking the latest decline in prices over the past seven years, according to monitor.
Since 2017, farmers have been facing frustration due to millers offering Shs175,000 per tonne, which further decreased to Shs96,000 in 2021. Prices then saw an increase to Shs240,000 in 2023 before experiencing a subsequent drop of Shs65,000.
One of the sugarcane farmers, expressed his dissatisfaction with the reduction in sugarcane prices, describing the Shs65,000 drop as “unfair” and “unacceptable,” especially considering the financial commitments of farmers who are servicing loans. In an interview on Tuesday, he emphasized the high cost of investing in growing sugarcane, including expenses for seedlings and land rental, coupled with relatively low profits.
The General Secretary of Busoga Sugarcane Outgrowers Association, Mr. David Christopher Mombwe, interpreted the drop in sugarcane prices as a form of “exploitation” of farmers. He asserted that over the years, sugarcane farming has been consistently more profitable for millers than for growers. Mr. Mombwe urged the government to establish a minimum price of Shs250,000 per tonne for sugarcane, which he believes would stabilize prices and ensure fair returns for farmers.
Mr. Mombwe also highlighted that while raw cane is primarily used for sugar production, millers often utilize it for manufacturing other products such as biogas, molasses, and fertilizers.
Contrarily, the Chairperson of the Uganda Sugarcane Growers Association (USGA), Mr. Isa Budhugo, argued that reducing sugarcane prices due to a decline in sugar prices is not justified. He pointed out that the breakeven point for sugarcane farmers is Shs210,000, and receiving less than that could lead to financial difficulties, potentially leading to property confiscation by banks. Mr. Budhugo issued a warning that sugarcane supply to millers would be halted for 30 days as they seek to stabilize prices.