South Nyanza Sugar Company (Sony Sugar) has successfully settled all farmers’ arrears by disbursing Sh306 million to address historical debts owed to cane growers.
Martine Dima, the firm’s Managing Director, reported that the government provided Sh181 million to help clear these historical debts. Additionally, Sh125 million was paid to farmers for cane delivered to the factory in June, thereby eliminating the backlog of debts owed to growers.
“We are happy as a management of great efforts made to clear the farmer’s outstanding debts. We now want to make sure that we pay promptly after deliveries,’’ said Dima
Sony Sugar Company is now processing payments for the month of July, which amount to over Sh100 million. The government had committed to clearing outstanding farmers’ arrears totaling Sh685 million in two phases. The initial payment has been made, and the Sh125 million represents the balance.
During a press briefing at the Sony Sugar stand at this year’s Kisumu Regional ASK show, Dima emphasized the company’s goal of reducing the waiting period for payments after cane is delivered.
Sony Sugar recently received accolades for being the best agribusiness, manufacturer, and sugar industry, as well as the second-best exhibitor in trade and climate change innovations.
Dima and the company’s Board of Directors, led by Chairman Jared Kopiyo, announced that Sony Sugar is now on a path to recovery after years of financial losses.
In recent years, the company faced a severe shortage of cane supplies from farmers, resulting in a significant decline in daily production output. Some farmers had reduced their cane acreage due to delayed payments, which forced Sony Sugar to mill between 1,300 to 1,500 tons of cane per day instead of the installed capacity of about 3,000 tons. This severely impacted their revenue.
However, with the company gradually regaining its financial footing after addressing its debts, cane farmers are now returning to large-scale cultivation of the crop.
“We are receiving steady cane supplies and we have now been able to improve daily production per ton from the current, 1500 to 2300 tcd on the upward trend,’’ he said
Kopiyo and the Board of Directors, including Mary Kopot, expressed their gratitude to President William Ruto for fulfilling his promise to disburse funds to clear the backlog of arrears owed to cane farmers.
However, Dima pointed out that the company, which has had its milling plant operational since 1976, continues to face challenges due to aging machinery. The efficiency of the current milling plant has declined, impacting production output as they are forced to frequently repair old parts, which incurs high costs.
