Chemilil Sugar injects US$5.8M into farmers’ pockets after privatisation
Chemilil Sugar says private investment has accelerated factory modernisation, farmer payments and worker welfare, while production remains below the plant’s rated capacity.
KENYA – Chemilil Sugar Company has injected Kes 750 million (US$5.8M) into the local economy through payments to farmers since a private investor took over its operations in May last year.
Deputy General Manager Michael Wanjala said the company had also made progress in modernising its factory and facilities while maintaining production.
“We have crushed approximately 110,000 tons of cane while continuing to improve the factory and facilities through targeted maintenance and phasing out of old equipment and replacing them with modern and more efficient ones,” Wanjala said.
He said the company initially expected to shut the plant for about 18 months to restore it to operational standards but resumed production sooner after the government urged investors to restart operations.
Wanjala said private investment had brought expertise and capital needed to modernise the factory and improve its efficiency.
“What we have brought in is the expertise; what we have brought in is the investment which then transforms the technology so that we are able to run the factory in a more efficient way and in a more productive way,” he said.
The company has also maintained weekly payments to farmers delivering cane, while about 500 employees are receiving salaries and other benefits on time.
Wanjala said statutory deductions, including SHA and NSSF contributions, were being remitted within the required timelines.
He described the leasing of Chemilil, Sony, Muhoroni and Nzoia sugar companies to private investors as a major move by President William Ruto’s administration.
Wanjala said restarting the factories was supporting businesses in the sugar-producing regions, creating employment and improving livelihoods while helping reduce sugar imports.
Despite the investments, Wanjala said Chemilil still had significant work to complete because the factory was established more than 60 years ago.
“The factory was in such a sorry state that despite our continued and very determined investment, we are now just at about 50 per cent of the rated capacity,” he said.
The factory has a milling capacity of 2,500 tonnes of cane per day but is currently processing about 1,250 to 1,300 tonnes daily.
“We are not there yet but we are continuing to make investments, simultaneously also investing in cane so that in the medium term we shall be able to run the factory optimally,” Wanjala said.
Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.
