KSB announces new sugarcane price of Ksh.5,500 amid market shifts

In a letter dated April 24, 2026, and addressed to millers across the country, the Board said the revised price takes effect immediately and must be adhered to when making payments to farmers.

The directive, signed by Acting Chief Executive Officer Jude Chesire, follows deliberations by the 4th Interim Sugarcane Pricing Committee, which held meetings on April 17 and April 24, 2026, alongside broader consultations on prevailing market conditions.

Millers were also instructed to ensure timely payments to farmers, as part of efforts to stabilise the sector and maintain confidence among cane growers.

The new price represents a reduction from the previous rate of Ksh.5,750 per tonne, a move the government says was necessary due to shifting market dynamics, including increased sugar production and falling retail prices.

According to officials, the review was informed by a rise in local sugar output driven by improved cane availability and higher factory production.

The reopening of several previously dormant state-owned sugar factories, now under private management, has further boosted supply in the market.

As a result, the price of sugar has dropped from about Ksh.7,000 to between Ksh.6,000 and Ksh.6,100 for a 50kg bag, prompting the need to adjust the cost of raw materials to keep millers operational.

Sources familiar with the pricing discussions indicated that some millers had proposed a deeper cut to Ksh.5,000 per tonne, citing high production costs and shrinking profit margins.

However, the government opted for Ksh.5,500 as a compromise to shield farmers from a steep income drop while still addressing industry sustainability concerns.

Despite the reduction, Kenya’s sugarcane prices remain among the highest in the region. Farmers in Tanzania earn an estimated Ksh.4,900 per tonne, while those in Uganda receive around Ksh.4,500 per tonne.

The pricing decision forms part of broader reforms being spearheaded by Agriculture Cabinet Secretary Mutahi Kagwe, aimed at reviving the sugar sector, strengthening mill operations and reducing reliance on imports.