Mumias mills grind to a halt as farmers deliver cane to rivals

Sugar miller Mumias has temporarily stopped operations due to lack of raw material.
Its chairman Dan Ameyo Tuesday said the Nairobi Securities Exchange (NSE) listed firm has stopped producing because it cannot get enough cane from its catchment area.
Mr Ameyo said most farmers signed by the company to supply cane had reneged on their contracts and were delivering to rivals.

Mumias has an agriculture department that helps farmers to develop cane on contracts that bind them to exclusively supply it.
Late payments have however seen farmers shun Mumias, preferring to supply rival millers who in most cases pay cash-on-delivery.
The company claims to have so far lost 750,000 tonnes of cane due to poaching, adding that the factory will remain closed until the situation is addressed.
 “Our cane has been poached because people have ready cash just to buy cane which other people have developed. We would like a reversal of this trend so that the sustainability of this and other companies is assured,” Mr Ameyo said.
The partly State-owned miller only months ago received a Sh1 billion bailout from the Treasury, and is scheduled to get another tranche in the coming financial year starting July.
The company is an important cog in the economic wheel of Western Kenya, making it a strategic investment for the government.
Mr Ameyo said Mumias can withstand competition from the private millers “so long as the playing field is level.”
“It is a worrying trend. We now have other millers who have come around flashing cash and going and picking cane without investing in its development,” he said.
Mr Ameyo said that the company will start instituting legal proceedings against rivals engaged in cane poaching.