A look into the rising Sugar prices in Uganda!

I commissioned a state-of-the-art ethanol distillery at Kakira Sugar Factory in Jinja today (Museveni, 23rd January 2017)

There are various of reasons for the rising prices of Sugar and processed sugar in Uganda. This isn’t the first time or last cycle of inflation on the prices of this common commodity. Sugar is common in Uganda for concept of having in it in the chai or the milk tea. To sweeten the milk and the black tea the Ugandans drink. Therefore, the Ugandans are needing and using lots of it on daily basis. It isn’t a luxurious goods, but a daily usage, for ordinary use. It has become staple and is staple together with matooke, cassava, rice and maize flour. This is all seemed as basic for the Ugandan people. Sugar is something very important. Therefore, the rising prices says something is out balance.

The balance have now been lost a year after the election. The prices of goods and food was also rising in 2011, therefore, the Republic had the Walk 2 Work demonstrations. These was demonstrations against the rising food prices, which also meant the sugar at that time went up. The same is happening now. With also on alternative exception, that the producers are not only creating sugar for consumption anymore, but ethanol and bio-fuel. Therefore, the produce and profits are going to export bio-fuel and other products, instead of the sugar that the consumers in Uganda uses. This also is an explanation for the rising prices, as well the added exports to Kenya, where the producers gain more selling it there. Than in Uganda, take a look!

In April 2017 USMA commented:

Uganda Sugar Manufacturers Association (USMA) says the increase in sugar prices has been prompted by the increase in cost of production and the deprecating shillings against major currencies. The Association’s Chairperson, Jim Kabeho says sugar millers were forced to announce what he called a paltry 4 percent increase on each 50-kilogram bag on ex-factory price. The increase according to Kabeho saw a 50-kilogram bag of sugar trading at one hundred and eighty five thousand shillings up from one hundred and seventy thousand shillings” (…) “Meanwhile a source at the Ministry of Trade Industry and Cooperatives who asked for anonymity says the Ministry suspects that the big players like Kakira could have decided not sell its sugar to the market so as to increase production at the ethanol its ethanol plant. The sources says sugar mills with ethanol plants are finally making money on sugar through on co-generation of power, alcohol and ethanol” (URN, 2017).

In April in Masindi:

Masindi district leaders have risen up against the Masindi district Resident Commissioner, Godfrey Nyakahuma over stopping sugar cane buyers from buying cane from Masindi district. Last week, Nyakahuma launched an operation of impounding trucks of all sugar cane buyers who buy sugar cane from Kinyara sugar limited out growers and over five trucks loaded with cane were impounded by police” (…) “Byaruhanga added that that is a sign indicating that Kinyara sugar Factory has no capacity to crush the available sugar cane adding that since Uganda has a liberalized economy let everyone come and buy the abundant cane available instead of leaving the farmers suffer with the monopoly of Kinyara sugar factory. Amanyire Joshua the former mayor Masindi municipality said that if Kinyara is saying that sugar cane buyers are poachers, Kinyara sugar factory is a smuggler because it is also doing the same. Mary Mujumura the deputy speaker Masindi district blamed Byaruhanga Moses the presidential advisor on political affairs for failing to advise the president on political issues saying that he is not supposed to enter into business matters” (Gucwaki, 2017).

In May 2017:

From last year’s average of Shs 3,000 per kilo of sugar, the price shot to Shs 4,000 early this year and is now hovering over Shs 5,500. A kilo of Kinyara sugar is the cheapest at Shs 5000, while Kakira sugar is selling at 6,000 a kilo. On the shelves, Kakira sugar and Lugazi sugar are scarce compared to Kinyara sugar, which is in plenty. Many dealers have now started hoarding sugar in order to benefit from anticipated price hike in the short term” (URN, 2017).

In May 2017 – Stanbic Statement:

The only category to buck that trend was wholesale & retail, where staff costs rose and employment fell. Average purchasing costs also rose in April, reflecting increased prices for animal feed, food stuffs, raw materials and sugar. Higher cost burdens were passed on to clients, leading to a further increase in output charges” (Stanbic Bank, 2017).

President Museveni praises Kakira Millers:

I would like to thank the Madhvani Group, despite the disappointment by Idi Amin. The family pioneered the production of sugar in Uganda. By 1972 they were producing 70,000 tons but today they have almost tripled the production to 180,000 tons,” he said. The President was today commissioning a state of the art ethanol distillery at Kakira Sugar Limited in Jinja district. The US$36 million facility, which is the largest in the East African Region, will be producing 20 million litres of ethanol annually” (…) “President Museveni pledged to address the issues to regulate the sugar industry but urged the Madhvanis to partner with farmers with large chunks of land for production of sugar-cane, as the cane is not a high value crop. He said people with small land holdings should be left to do intensive farming like the growing of fruits that give high returns. Turning to the issue of prices payable to sugar-cane out-growers, President Museveni advised the buyers and out-growers to sit together and agree on the prices taking into consideration the market prices globally” (Uganda Media Centre, 2017).

Government statement on the 11th May:

Speaking to 256BN on condition of anonymity a government official monitoring the situation said the manufacturers have not increased the factory price, but he conceded that the situation is worrying. “At the factory prices are stable. Why is it that the prices at the retail gate are high. This means that there are some distributors who are using the hiding strategy in order to rob Ugandans. As Government we shall continue monitoring the situation until we come up with the solution” the official said. Affordability of sugar is considered a key barometer of an ordinary person’s well-being and its pricing can take on political dimensions when people cannot have sugar with their tea” (256BusinessNews, 2017).

Putting the price in pespective:

Kakensa Media reported this today: “Today sugar costs 7000/- per kilo. When Museveni came to power in 1986 each kilo was at 4/-(four shillings). Immediately he came to power he said Ugandan shilling had lost value, in 1987 all money was changed, not only changed but two zeros were cut off to give it value on addition to the 30% levied on each shilling. This means on every 100 shillings, you got 70cents. Those who had 100,000/- got 700/-” (Kakensa Media, 12.05.2017).

This is all proof of a systemic malpractice, where both export, together with lacking yields because of drought and also the production of ethanol and bio-fuel. All of this collected together are reasons for the rising prices of sugar. The sugar price goes up because the use of cane for other things than millers producers sugar for consumption, but for other export products. This is all making sure even as the Republic of Uganda has in the past produces to much, it now doesn’t. Since it elaborately uses the sugarcane for other products.

That has made the Madhvani Group rich and their exports of sugarcane products are clearly selling. Now even their basic milled sugar are sold more expensive on the Ugandan market. There are also proven problems by other millers, who either has to much cane like Kinyara Sugar Factor in Masindi. Which is ironical problem, as the Kakira and Lugazi sugar is empty on the shelves, while the sugarcane hoarding Kinyara are still in the shops. But Kakira which is produced by Madhvani Group, we can now understand, since they have bigger operation and is blessed by the President for their industrial production of ethanol and bio-fuel.

Therefore, the are more reasons than just shopkeepers not getting enough stocks. That the rising prices are not only that there is lacking production. It is the system of export and production. Where the cane isn’t only becoming milled sugar for consumption, but for all the expensive industrial exports like bio-fuel and ethanol. This is all good business, but also bad for consumers and citizens who are accustom with decent prices for their sugar. That is not the fact anymore, as the business and millers has found new profitable ways. So that the surplus sugarcane and also the other gains massive profits. This is all good business for the owners of the sugar-millers and sugar industry. The one who feels the pitch is the consumer and the citizens. Who see scarcity of sugar inside the shops and also the inflation of prices on the sugar. Peace.

Reference:

256BusinessNews – ‘Government to issue statement on sugar’ (11.05.2017) link:http://256businessnews.com/government-to-issue-statement-on-sugar/

Gucwaki, Yosam – ‘MASINDI RDC IN TROUBLE OVER STOPPING SUGAR CANE BUYERS’ (28.04.2017) link: http://mknewslink.com/2017/04/28/masindi-rdc-trouble-stopping-sugar-cane-buyers/

Stanbic Bank Uganda – ‘Ugandan economic growth continues at start of second quarter’ (04.05.2017) link: https://www.markiteconomics.com/Survey/PressRelease.mvc/143ca2b8e3d84c79b96aed4885b7337e

URN – ‘Sugar manufacturer’s association explains price hikes’ (14.04.2017) link: https://dispatch.ug/2017/04/14/sugar-manufacturers-association-explains-price-hikes/

URN – ‘Uganda: Sugar Crisis On for Another 2 Years – Manufacturers’ (09.05.2017) link: http://allafrica.com/stories/201705100129.html

Uganda Media Centre – ‘President Praises Madhvani Group’ (05.05.2017) link: https://mediacentre.go.ug/news/president-praises-madhvani-group

Opinion: Too many Gangsters and too few Statesmen!

“The truth is that every intelligent man, as you know, dreams of being a gangster and of ruling over society by force alone. As it is not so easy as the detective novels might lead one to believe, one generally relies on politics and joins the cruelest party. What does it matter, after all, if by humiliating one’s mind one succeeds in dominating every one? I discovered in myself sweet dreams of oppression.” – Albert Camus

In the time of abundance of information, of knowledge and of history, we still reap of a world not of Statesmen, but of gangsters. These sort of people who collect themselves in dens at night to scheme and to plan their next theft. Instead of building nations, building republics and building the foundation needed for the future generations.

We have a leadership and a bunch of leaders, who are more around their wealth and their image, than their achievements, as the protocol is to standout, but not deliver polices that actually matter.

That the politician of our day, many of them and the ones who rule, wants to have power, they seek power and they grab power by any means. While the citizens in fear of answering the theft and the perfect crime, let it go for their safety and their families sake. The thieving from the highest offices, the might of these men. The vicious theft of state reserves done in broad day light, on the main-streets of the capitals of the world. As if the state coffers was personal reserves for Gucci or Fendi. Instead of serving the public with welfare and decent infrastructure.

The biggest thieves are the actual criminals, because they do in the dark and steal, they sell illegal dozes of drugs and violates justice with impunity. That is their role in society. They are supposed to be the ones who force ill and creates havoc if caught. The leadership of the nations are supposed to be the example of men, the one the citizens looks up to and want to become. They want to emulate and know that these men makes the future.

Instead, they are vicious, playing in codes and use all sort of tricks to get the public funds, to misuse and allocate the funds, so that the welfare dies and the state suffers. So that they can ride in the most expensive vehicles known to men, so they can afford the best cuts of meat, one prime real estate and wear the fancies imported suits. Still, the ones they are take care off; they suffer and can nearly scrap funds for the schooling for their daughters and sons.

Therefore, the biggest thief is not the ones who actually does direct crime, but the gangsters in Parliament, in local government and the Presidents. Who eats of the government plate, take the funds without any hesitation and spends their time sponging fortunes, which was supposed to benefit the public. These sort of acts of looting that skates by and leave nothing, but dust behind.

That the sweet dreams of oppression, the sanity of society and the knowledge of the culprit, the knowledge of the capacity of the leadership and regimes to misuse their power and their connections, the altercation of the norms to benefit the elite and the businesses surrounding the state. Instead of having a state that actually works of the citizens. There are certain signs of misbehavior that never should happen. So that the citizens are sure their representatives are men of honor and men of pride, not just who eats of the plate of the citizens. That doesn’t misuse the capacity as representative to get wealth, but to build their nations. As a functioning branch that support the citizens and listens to the will of the citizens. Since if, they get wealth by being connecting to corporations, to international community, more than the citizens. Then there is something wrong with the system between citizens and their representatives.

The leadership should not focus on the power they have, but the power that is bestowed them. They would not have it, if it were not for the people. They would just be citizens without any special function or be deserves anything else. The representatives are there as an acknowledgement from their constituency. If they forget that, then it is time to change them. Then the public should elect someone else, since the citizens deserves better representation.

Therefore, as we see today and look beyond for tomorrow, we should think of the reasons why we have so many gangsters in charge, why we let them and why we cannot get rid of them. They are there with force, but not with our will. We should act upon it and deservedly not let us, be taken for granted or being used by some gangsters. We should give time and effort to dismantle the leadership and finds way to forge a new future. With leaders who represent not only themselves, but also their constituent and their will.

That the people who are having nations run by gangsters should feel betrayed, they should find ways to get rid of them. Not just let it be status quo, let them run the shop and take the spoils. Leave nothing behind, but stolen promises and leaflets of pledges. The empty hope and the theft of nations, as the resources, the future generations and the present struggles become harder, as the crime of the gangster are determined in dens without knowledge of the commons.

These sort of acts should not have the time or the day, in our age, but they do and with a grander acts than before, and we let it happen. We let them take, we let them do and we let them justify their rule. As we are just citizens, they can walkover and does not need to serve. As long as we let the gangsters, we are at our own fault, as we let the crime go-on… and go-on… with no plan of change for the better. We just let our government sink as a ship, with no exit plan and no Plan B.

The Gangsters are eating, we are drowning, is this the supposed enlightenment we as society was supposed to have? Peace.