Unstoppable: Rai family becomes Kenya’s leading sugar manufacturer with the launch of their fourth milling plant
Take the billionaire Rai family, for example. The launch of their fourth milling plan this year has positioned them as the leading sugar manufacturer in Kenya, from a combined capacity of the existing three mills of West Kenya, Olepito, and Sukari.
The $44-million Naitiri Sugar Company, which started milling in May, would produce at least 6,000 tonnes of sugar per day. The establishment of the plant will also operate as an extension of the West Kenya Sugar Company – one of the many entities run by the family as part of its effort to widen its dominance of the sugar industry in East Africa.
Furthermore, the plant will also be a source of employment for Kenyans and also a source of pride.
Saulo Busolo, former chairman of the Kenya Sugar Board, says because the country remains sugar deficit, there is no harm in millers expanding their market share to bridge the shortage, Business Daily reported.
“The question that we should be asking is whether the company is paying farmers promptly after harvesting and if they issue permits for cutting cane on time,” said Mr Busolo.
“If they meet all that, then the question of dominance should not arise.”
Data from the Sugar Directorate indicates that Rai’s sugar factories controlled up to 43 per cent of the total production in the country in the 10 months to October last year.
The companies, led by their chairman Jaswant Rai, have expanded their cane catchment area to as far as Trans-Nzoia and Uasin Gishu Counties. These regions are predominantly maize growing.
The Rai family, whose fortune’s origins can be traced to the patriarch’s forays into agriculture in Zaire (now DR Congo) and Kenya in the ’60s, revealed that the newly built sugar plant would launch operations with the capacity of producing 3,000 tonnes of cane per day, and up to 6,000 tonnes at peak.
The plan was initially scheduled for commissioning in 2020. However, several factors, including the pandemic and access to foreign exchange, disrupted the importation of equipment and travel for experts needed to facilitate the installation of new modern equipment at the factory.
Kenya relies on imports from Common Market for Eastern and Southern Africa (Comesa) to bridge an annual deficit and stabilize prices because of the poor performance of local millers.
The country imports up to 350,000 tonnes of sugar from Comesa; however, the Treasury capped the volumes last year to 210,000 tonnes to guard against the dumping of sweeteners in the country.