Kinyara Sugar Ltd to pay Shs5.5billion cash top-up to cane farmers

Masindi: Kinyara Sugar Ltd is set to pay Shs 5.5 billion as cash top up to farmers that supplied sugarcane to Kinyara Sugar factory during the 2025/2026 financial year.

The cash top up refers to the additional money Kinyara Sugar Ltd pays to its contracted farmers at the end of a financial year on top of the interim price paid to farmers during a financial year.

As a standard practice of the company, in the last quarter of each financial year, Kinyara Sugar Ltd Management sits with the board of directors representing registered farmers to review the price of the current financial year (2025/2026) and to set the interim price for the new financial year, (2026/2027). The Kinyara Sugar Management was led by the Company Chief Executive Officer Mr Ravi Ramalingam while the farmers were led by Mr Robert Atugonza, the Board Chairman of Masindi Sugarcane Growers Association Ltd (MSGAL).

As per the mutual resolution between the Management of Kinyara Sugar Limited (KSL) and the Board of Directors of Masindi Sugarcane Growers Association Limited (MSGAL) at a price negotiation and harmonization meeting held on Thursday, we are pleased to inform all our stakeholders that the company will pay cash top ups to all our farmers that supplied us sugarcane during the 2025/2026 financial year, the Kinyara Sugar Ltd’s Public Relations Officer, Mr Francis Mugerwa announced in a statement.

The money will be credited on bank accounts of all the eligible farmers as per their respective entitlements.

The Kinyara Sugar Ltd operates a unique model where by management engages the farmers’ association to set an interim sugarcane price for each metric ton of sugarcane supplied to the sugar factory in a given financial year which runs from July 1st to June 30th of the next calendar year.

They jointly set the sugarcane interim price revised during the financial year and/or at the end of the financial year depending on the prevailing market situations.

At the end of the financial year, Kinyara Sugar Ltd Management and the farmers representatives agree on a final price/ top up price.

After engagements between Kinyara Sugar Ltd Management and the farmers representatives, it was unanimously agreed that the farmers that supplied sugarcane at a price of 128,000 per ton will get a cash top up of 1,500 while farmers who supplied sugarcane at 114,000 per ton will get a cash top up of 8,000 per metric ton supplied.

Impacts of payments

The money which Kinyara Sugar Ltd pays to its contracted farmers is having a multiple impact in communities in Masindi district and other parts of the country.

“The money has empowered farmers to expand their businesses and improve their livelihoods” the Masindi district vice Chairman Mr Bright Mugume said.

The billions of Shillings which Kinyara Sugar Ltd pays farmers, contractors and the business community has improved incomes of farmers, contractors and the business community, Mugume said.

Besides the direct payments to farmers, contractors and service providers, Kinyara Sugar Ltd rehabilitates and maintains thousands of kilometres of roads, provides safe and clean water to communities and supports education, health and other community services, said the Masindi Resident District Commissioner (RDC) Mr Darius Nandinda.

“The taxes Kinyara Sugar Ltd pays to Government, the thousands of jobs it offers to the people and the programs targeting communities compliment Government programs of improving service delivery and improving livelihoods of the people” said Nandinda, the President’s representative in the district.

The Board Chairman of Masindi sugarcane Growers Association Ltd Mr. Robert Atugonza who led representatives of registered farmers during the price negotiations with KSL Management said the cash top ups are a result of a Cane Production Contract (CPC) between Sugarcane growing farmers and the company.

The cash top up is widely viewed by farmers as an additional incentive on top of the interim price they already received after harvesting and tallying their cane.

“Overall, farmers appreciate this cash top up. I urge them to improve on agronomy practices on their fields so that they increase productivity and yield of the plantations”, Atugonza said.

He said improved cane productivity enhances the overall incomes of the farmers.

“I urge farmers to grow and supply more sugar cane to Kinyara Sugar factory as one of the ways of harnessing the unique outgrower scheme” Atugonza said.

He said this model implies that more farmers will supply sugarcane to Kinyara Sugar Ltd with confidence irrespective of the current interim price, there will be a price negotiation at the end of the financial year to cater for any price variations during the year.

Background facts 

The company has approximately 8,000 registered farmers that supply over 60% of the sugarcane crushed by the factory. Kinyara has an installed capacity of crushing 10,000 tons per day but on average the factory crushes about 7,500 tons per day.

Kinyara Sugar Ltd currently buys a ton of sugarcane at an interim price of Shs 112,000. Just like the previous years, the interim price will be reviewed at the end of the financial year.

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