Kenya's sugar sector is showing signs of recovery as government reforms improve farmer returns, strengthen cane supply and drive a sharp increase in domestic production, although the country remains dependent on imports to fully meet demand.
The minimum price paid to sugarcane farmers currently stands at KSh5,500 per tonne (about $42.30), with growers in Nandi saying the improved price, faster payments and better access to weighing facilities have restored confidence in sugarcane farming.
The reforms come after years of low prices, delayed payments and operational problems at state-owned sugar mills. The government has leased Nzoia, Chemelil, Sony and Muhoroni sugar mills to private investors, while the Sugar Act 2024 introduced a 4% Sugar Development Levy to support factory modernisation, farmer services and sector regulation.
Production has responded. Kenya produced 528,875 tonnes of sugar between January and July 2026, with monthly output reaching 89,709 tonnes in June and a record 91,022 tonnes in July. The stronger performance has been driven by increased cane availability and improved factory operations.
The government is also tightening protections for farmers. Sugar millers have been directed to pay growers within seven days of receiving cane, with delayed payments subject to penalties and interest. The Kenya Sugar Board is procuring mobile weighbridges after reports that some farmers have lost payment for as much as three tonnes of cane per trailer through weighing malpractice.
Despite the recovery, Kenya is not yet producing enough sugar to meet national consumption. Demand is estimated at about 1.2 million tonnes annually, meaning imports remain necessary. However, the latest recovery is expected to reduce import requirements, with USDA forecasting 850,000 tonnes of domestic production and 370,000 tonnes of imports for 2026/27.
The government has also moved to restrict new sugar import licences, arguing that rising domestic production should be given room to strengthen the local industry.
NBF Insight
Kenya's sugar recovery shows what can happen when farmer incentives, factory management and sector regulation move in the same direction. Higher cane prices alone cannot revive the industry. Farmers need confidence that their cane will be weighed accurately, collected on time and paid for promptly, while mills need the capital and management capacity to process more efficiently.
The bigger test now is whether the production recovery can become sustained, rather than another temporary improvement. If Kenya can maintain higher yields and efficient milling while reducing costly imports, more of the country's sugar value chain could remain within the domestic economy.
