Masindi – Kinyara Sugar Ltd is going to pay cash top ups worth Shs 17 billion to its contracted farmers that supplied sugarcane in the 2024/2025 financial year.
The resolution for the cash top ups was mutually agreed on 25th June 2025 between the Management of Kinyara Sugar Limited (KSL) and the Board of Directors of Masindi Sugarcane Growers Association Limited (MSGAL).
A joint press statement released by KSL and MSGAL on Monday indicated that the joint meeting set the interim price for the financial year 2025/2026 at Shs 128,000 per metric ton.
“The interim cane price for the financial year 2025/26 will be reviewed basing on the market situation during and / or at the end of the financial year” the statement read.
According to the statement, after an engagement, the company and the farmers representatives unanimously agreed that the sugarcane price for the financial year 2024/2025 is Shs 131,500 per metric ton.
The Kinyara Sugar Ltd’s Public Relations officer Mr Francis Mugerwa explained that the company has a unique out-grower system/ operating model in place where by management engages the farmers’ association to discuss the sugarcane price that is jointly finalized.
“We jointly set the sugarcane interim price that is revised during the financial year depending on the prevailing market situations. At the end of the financial year, we agree on a final price.
The difference between interim price and the final price is released across all farmers that supplied cane throughout the financial year,” Mugerwa explained.
KSL Management and MSGAL Board resolved that; Farmers who supplied sugarcane at an interim price of Shs 122,500 per metric ton will receive a top of Shs 9,000 per metric ton.
Farmers that supplied cane at an interim price of Shs 108,000 per ton will receive a top up of Shs 23,500 per metric ton while farmers that supplied cane at an interim price of Shs 116,500 will receive a top up of Shs 15,000 per ton.
By doing the above, it implies that all farmers who supplied sugarcane from July 1st 2024 to June 30th 2025, did supply at a price of 131,500.
“This is a unique practice of Kinyara Sugar Ltd that it uses while handling payments to its contracted farmers,” Mugerwa added. “The cane prices were concluded in the spirit of mutual understanding between both parties,” a joint statement read in part.
The company extended its appreciation to its contracted farmers for their continued support, patience, and cooperation towards business continuity.
The MSGAL Board Chairman Mr. Robert Atugonza who led representatives of farmers during the price negotiations with KSL Management appreciated the cordial partnership between KSL and the farmers.
“We are grateful for the consensus of both parties to sustain the business irrespective of the market conditions,” Atugonza said.
He implored all farmers to harness this model by supplying sugarcane to Kinyara Sugar Ltd with confidence irrespective of the current interim price.
“Am much sure that the culture between KSL and MSGAL to always negotiate at the end of the financial year shall always be done catering for any price variations during the year,” Atugonza said.
The Masindi Resident District Commissioner (RDC) and chairman of Masindi district security committee Mr Darius Nandinda appreciated farmers and Kinyara Sugar Ltd for peacefully reaching a consensus on the sugarcane price or any other issues affecting the sugar industry.
“The billions of shillings which the company pays the farmers, contractors and government through taxes are improving service delivery and causing social-economic development of Masindi and the country at large,” Nandinda said.
Background
The company has over 7,500 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 6,000 tons per day.
It is estimated that the company will pay about Shs 17 billion to farmers in cash top ups which are expected to be effected within 40 days from the date of reaching consensus.