Sugar production rises by 18pc despite shortage of cane

Improved efficiency by millers saw sugar production increase by 18.1 per cent in the first seven months of the year, defying biting cane shortages.The Kenya National Bureau of Statistics data shows millers had processed 337 metric tonnes of sugar at the end of July, an 18.1 per cent increase from the 288 metric tonnes produced over a similar period in 2010.

Cane deliveries, on the other hand, increased by a marginal 2.7 per cent.

Sugar prices more than doubled to Sh200 a kilo last month on what millers said was a drop in cane deliveries.Research analysts at Standard Investment Bank said the growth in production “probably reflects better factory efficiency”.Mumias Sugar Company said it had updated its technology to get more sugar out of a unit cane and reduce wastage.

The miller accounts for up to 60 per cent of Kenya’s total sugar production.“We have installed top of the range equipment which makes our recovery very good,” said Mumias Sugar Company marketing and corporate communications director Pamela Lutta.Recovery is the measure of the sugar that is derived from a unit of cane.The company grinds a tonne of sugar for every nine to 10 tonnes of cane crushed.The industry average is between 13 to 15 tonnes of cane crushed to produce a tonne of sugar.

Mumias Sugar Company is the only miller in the region that uses diffuser technology, which enables it use less cane to produce a unit of sugar.Nzoia Sugar Company managing director, Mr Saul Wasilwa, said scarcity of sugarcane has hit millers hard.“We have experienced an acute cane shortage and all the factories have had to compete for cane,” said Mr Wasilwa.Eric Musau, a research analyst at Standard Investment Bank, said that another factor that could have contributed to the rise in production is higher sugar content of the cane, rather than its weight.

This is despite flat growth in cane delivery.Mr Musau said that this also explains the push for farmers to be paid for sucrose content rather than weight of the cane. The momentum in production is, however, not likely to be maintained until end of the year since millers have already taken time off for the annual maintenance of their machines.Mumias Sugar Company had closed its plant in August for repairs and Nzoia has also embarked on servicing its machines.

Mr Wasilwa said that as expected sugar imports flow in, prices may come down.The weakening shilling, however, threatens to maintain high prices, said Mr Musau.The shilling, which is just shy of the 100 mark to the dollar has made imports more expensive.

source: businessdailyafrica