Kenya Sugar Board audits informal sugar imports

KENYA – The Kenya Sugar Board (KSB) is conducting an audit of informal sugar imports to determine the volumes traded, routes used and factors driving cross-border sugar flows amid concerns over market distortions and revenue losses. 

According to a report by Business Daily, the audit seeks to establish the scale of informal sugar imports and map the routes through which the commodity enters Kenya. 

“The industry faces severe market distortions and inefficiencies, primarily due to unregulated cross-border trade,” KSB said in a brief. 

The regulator said Kenya remained a net sugar importer, producing about 72% of domestic requirements in 2024. It added that the market remained vulnerable to illegal sugar inflows through porous borders, weak traceability systems and significant price disparities. 

“This informal trade undermines local producers, distorts prices, discourages investment and results in substantial loss of government revenue,” KSB said. 

The audit will map and profile actors involved in informal sugar trade, including supply chains, financing mechanisms and incentives. It will also assess the impact of informal trade on farmgate prices, miller viability and national sugar pricing mechanisms, while evaluating revenue losses associated with informal imports. 

KSB Chief Executive Officer Jude Chesire said the audit was still underway, with the regulator focusing particularly on the Uganda border. 

“The audit is work in progress,” Chesire told Business Daily. “We are largely focusing on the border with Uganda because there is a lot of sugar in the neighbouring country and the chances of smuggling are very high.” 

He added: “We have requested extra police officers to help map out the informal trade in sugar. Although informal trade is allowed, some groups take advantage to advance large-scale smuggling.” 

The audit comes after Kenya lifted safeguards on cheaper sugar imports from cane-producing members of the Common Market for Eastern and Southern Africa (Comesa) in January 2026. 

The move ended 24 years of protection for Kenya’s sugar industry. The safeguards, introduced in 2001 and extended eight times, had allowed Kenya to import up to 350,000 tonnes of sugar from the Comesa region to bridge domestic supply deficits. 

The removal followed the leasing of four state-owned sugar mills to private investors. Nzoia was leased to West Kenya Sugar Company, Chemelil to Kibos Sugar & Allied Industries, and Muhoroni to West Valley Sugar Company. Mumias was leased to Sarrai Group, although the deal later faced legal challenges and was halted by a court. 

Meanwhile, Kenya’s domestic sugar production has increased. Kenya National Bureau of Statistics data showed production rose nearly 22% in the first five months of 2026 to 348,143 tonnes from 285,418 tonnes a year earlier. Sugarcane deliveries increased 25.1% to 3.9 million tonnes over the same period. 

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