State Revives Sugar Board to Salvage in Ailing Sector

State Revives Sugar Board to Restore Investor Confidence in Ailing Sector

The Kenyan government has revived the Kenya Sugar Board (KSB) in what is seen as a way of restoring investor confidence in the troubled sugar sector.

In a notice shared to the public, the board resumed its mandate on June 3, 2025, as a fully re-established State Corporation, backed by the recently enacted Sugar Act No. 11 of 2024, which took effect on November 21, 2024.

The board transitions from the Agriculture and Food Authority – Sugar Directorate (ASD) an dis mandated to develop, regulate, and promote the sugar sector, even as the government takes charge to restore clarity, efficiency, and credibility in the sector.

“KSB is now a fully operational State Corporation mandated to develop, regulate and promote the sugar industry in Kenya. Its re-establishment marks a significant step toward revitalizing the sugar sector, ensuring efficiency, transparency and sustainable growth,” reads the notice in part.

Sweeping Reforms in the Sector

The transition comes two months after President William Ruto promised sweeping reforms in the sector, on the hope that the country would be a net producer of the commodity.

President gave Ksh.150 million bonus for sugar farmers who have supplied cane to Kakamega’s Mumias Sugar Factory, the first such payment in the sector.

According to the Head of State, the bonus validates the success of the some of the reforms introduced in the sugar sector and the evidence of the potential to uplift farmers and support tens of thousands of livelihoods.

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“With a record 832,000 tonnes of sugar produced last year, Kenya is on course to attaining surplus production and commence regional exports by 2026, turning sugarcane cultivation into a viable and rewarding venture,” said President Ruto.

All regulatory functions under the KSB will include licensing, compliance monitoring, and trade facilitation.

Cornerstone of Rural Economies

The sugar industry has long been a cornerstone of rural economies in regions like Western Kenya and Nyanza, supporting hundreds of thousands of smallholder farmers and factory workers.

However, over the past two decades, the sector has been marred by systemic challenges, eroding investor confidence thus leading to a decline in productivity.

But as part of the intervention to salvage the struggling sector, the Ministry of Agriculture and Livestock Development has already secured Ksh.12.29 billion investment from private firms to revive four state-owned sugar mills.

Agriculture Cabinet Secretary Mutahi Kagwe said the investment will go to Nzoia, Chemilil, Sony and Muhoroni Sugar companies, following a 30-year lease.

He said the move aims to restore operations, secure farmer incomes, and preserve thousands of jobs in the sector.

But even as the state moves in to revive the ailing sector, stakeholders are optimistic that the return of the KSB will help address these persistent issues, including taming bureaucratic overlaps, and foster a more conducive environment for investment, innovation, and farmer empowerment.

June 9, 2025

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