Parliament ’s Trade committee pins the trade ministry over escalating Sugar Prices

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Hn. Mwine Mpaka speaking during a session of Trade and industry Committee of parliament; Courtesy photo

By Mary Asujo

Parliament’s Committee on Tourism, Trade and Industry has learnt that Trade ministry has failed to put in place a sugar board to help regulate the industry, leading to high prices of sugar.

On November 2, 2022, the MP Nakifuma county, Hon. Fred Ssimbwa raised a matter of national importance on the floor of parliament over the escalating sugar prices versus sugarcane prices.

Ssimbwa stated that over the last six months, the price of a 50kg bag of sugar had averagely escalated from Shs150,000 in May to Shs165,000 in June 2022, Shs185,000 in September, Shs195,000 in October and currently averagely Shs215,000.

Ssimbwa, however said the sugarcane farmers are not benefiting from the increase in the sugar prices which is largely a regulatory issue stemming from non- operationalization of the sugar Act 2020 coupled with other challenges faced by the sugarcane farmers.

The Rt.Hon. Speaker Anita Among referred the matter to the Trade committee for further study and recommendations.

While speaking to the media at parliament on Tuesday, Trade Committee chairperson, Hon. Mwine Mpaka told journalists that they were disturbed that the Trade ministry has no board and it’s the one carrying out the mandate of issuing licenses which is wrong.

“We are investigating the regulations in the sugar cane. Farmers tell us that 5 percent is deducted from them and we want to establish who’s issuing licenses with no board,” added Mpaka. He explained that the genesis of escalation in the Uganda sugar industry is lack of order and stability.

Mpaka said, as a committee, they will be interfacing with the farmers to understand the issue so that they come up with a complete report to the house.

The Chairperson of Uganda Sugar Manufactures Association Mr. Jim Mwine Kabeho acknowledged that indeed sugar prices shot up from May to November 2022.

“The existing sugar mills have expanded their capacities and new mills licensed; however, except for a few mills like Kakira, Kinyara and SCOUL, this process is not synchronized with sugar cane developed either through miller owned sugar estates or development of enough out- growers to guarantee sugarcane supply to these mills.” Mr. Kabeho said.

“Licensing new sugar mills in areas where sugar mills are already established, without licensing a targeted sugar cane development program, is a recipe for disaster. It leads to increasing sugar production,” added Kabeho.

The law:

Parliament passed the Sugar Bill, 2020 which was later assented into law. The Sugar Act 2020 commenced on 28th August 2020. The object of the Act is to provide for the development, regulation and promotion of the sugar industry and provide for the establishment of the sugar board.

Section 3 of the Sugar ACT 2020 establishes the Uganda Sugar Board and section 4 (2) mandates the Minister to appoint members of the Board, however this has never been done. MPs say that this is one of the biggest causes of sugarcane price fluctuations because it’s the responsibility of the Board to decide the percentage “D” in the sugar cane price equation as per schedule 3 of the Act.

According to Ssimbwa, the Board has many functions such as arbitrate and mediate disputes between parties in the sugar industry, review, on a regular basis, the problems and prospects of the sugar industry services, lobby for incentives for the benefit of the sugar industry and provide advisory sevices to parties in the sugar industry among others. These would be the solutions to most of the challenges faced by the farmers but cannot be effected due to the absence of the board.

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