Three-month shutdown for five major sugar factories starts July 11, 2025.
The government has ordered a three-month suspension of all sugar milling operations across Kenya’s Upper and Lower Western regions due to an acute shortage of mature sugarcane, a move officials say is necessary to rescue the struggling sugar industry.
The directive, issued by the Kenya Sugar Board (KSB) and effective July 11, 2025, affects: Nzoia Sugar Company
Butali Sugar MillsWest Kenya Sugar Company (including Olepito and Naitiri), Mumias Sugar (2021) LtdBusia Sugar Industry Ltd
KSB CEO Jude Chesire said the temporary closure followed a consultative meeting in Kisumu and is intended to allow the cane to mature and reset cane supply systems.
“This suspension will allow sugarcane to mature and enable a reset in cane supply planning,” Chesire stated.
The crisis has been blamed on poor cane development planning and early harvesting, which caused a steep fall in national sugar output in early 2025. The KSB has directed millers to intensify cane development programs during the closure period.
A national cane census will be undertaken within two months to determine farm readiness and map out future harvesting cycles.
The milling halt comes just as the Sugar Development Levy (SDL) took effect on July 1, 2025. The new 4% levy is charged on: Ex-factory price of locally produced sugarCIF value (Cost, Insurance & Freight) of imported sugar
The Kenya Revenue Authority (KRA) will collect the levy monthly, with payments due by the 10th of each following month.
In a related reform, the Sugar Development Fund has been transferred from the Commodity Fund to the Kenya Sugar Board, with projected annual collections of over KSh 5 billion to be allocated as follows:40% (KSh 2B): Cane development15% (KSh 600M): Sugar zone road repairs12% (KSh 1.2B): Cane research & factory modernization5%: Farmer institution strengthening10%: Administrative functions
Despite long-term optimism, mill shutdowns could heavily affect farmers and mill workers dependent on factory operations for income. Stakeholders say proper execution of cane development plans will be critical.
“This is the moment to reclaim the future of Kenya’s sugar industry,” said Chesire.
If successful, the new sugar policy could phase out sugar imports and restore domestic production self-sufficiency by 2027.
The next three months could make or break Kenya’s sugar revival plan
