Uganda is now able to refine large quantities of sugarcane which are able to meet the needs of the domestic and export market.
The Permanent Secretary in the Ministry of Trade, Geraldine Ssali, said the sector is now producing over 600,000 metric tons of sugar compared to just under 200,000 metric tonnes in 2006.
Consequently, Uganda is the only net exporter of sugar in the EAC region, Ssali noted.
“The sector contributes revenue to Government in form of taxes amounting to over sh300b annually from the operational 14 sugar mills. The sector employs over 60,000 people directly in the factories, 200,000 cane outgrowers and much more indirectly,” Ssali said over the weekend.
According to the Economic Policy Research Centre at Makerere University, Uganda has registered significant strides in sugarcane production and processing ever since the liberalisation of the sub-sector.
In particular, the entry of more small mills increased the demand for sugarcane; which attracted more smallholder farmers to grow sugarcane.
With the rapid expansion of the sub-sector, the Government through the Ministry of Trade, Industry, and Cooperatives and Ministry of Agriculture Animal Industries and Fisheries formulated the 2010 National Sugar Policy and the 2019 Sugar Act respectively; to create an enabling policy and regulatory framework to facilitate the long-term inclusive and sustainable development of the sub-sector.
However, in the recent past, challenges have emerged that threaten the future sustainable development of the sugarcane sector.
The challenges include; the exit from sugarcane growing by smallholder farmers linked to persistent decline in cane prices, unfavourable payment terms by millers, and expansion in nucleus farms by millers, the emergence of sugarcane delivery permits (quota rationing) and invisible actors (middlemen).
Others are; abandoning the practice of sugarcane fields’ registration leading to market information asymmetry between millers and farmers, a disrupted input credit and extension support system between millers and farmers and limited coordination and public support to facilitate a sustainable and competitive sub-sector.