South Nyanza Sugar Company (Sony Sugar) has successfully cleared all arrears owed to farmers by disbursing Ksh306 million to settle historical debts. The firm’s Managing Director, Martine Dima, reported that the Government contributed Ksh181 million to address these outstanding debts. Additionally, Sony Sugar paid Ksh125 million for cane deliveries made in June, effectively eliminating the backlog of payments to growers.
Dima expressed satisfaction with the management’s efforts to resolve the farmers’ outstanding debts and assured that future payments will be made promptly following deliveries. The company is now processing payments for July, which amount to over Ksh100 million.
Government Commitment and Payment Progress
The state had pledged to clear a total of Ksh685 million in farmer arrears in two phases. The first phase has been completed, with the recent Ksh125 million payment covering the remaining balance. Dima, speaking at the Kisumu Regional ASK show, highlighted the company’s goal of reducing the payment waiting period after cane delivery.
Sony Sugar was recognized with awards for best agribusiness, manufacturers, and the best sugar industry, as well as second place in trade and climate change innovations at the event. Dima, alongside Chairman Jared Kopiyo and the Board of Directors, noted that the company is now on a path to recovery after years of financial difficulties.
Recovery and Production Improvement
Over the past two years, Sony Sugar faced a significant decline in cane supplies due to delayed payments, which led to reduced production. Farmers had cut back on cane acreage, affecting the company’s daily milling capacity. Previously milling around 3,000 tons of cane per day, Sony Sugar was only processing between 1,300 and 1,500 tons daily, impacting their revenue.
However, with the recent debt payments and improved financial stability, cane farmers have resumed large-scale cultivation. The company has increased its daily production from 1,500 to 2,300 tons of cane per day.
Ongoing Challenges and Future Plans
Despite the progress, Sony Sugar continues to face challenges related to its aging machinery. The milling plant, installed in 1976, suffers from declining efficiency and high repair costs for its outdated parts. Dima emphasized that while the company is making strides in financial recovery and production, addressing the machinery issues remains a critical priority.
Chairman Kopiyo and the Board of Directors expressed their gratitude to President William Ruto for fulfilling his promise to disburse funds to resolve the backlog of cane farmers’ arrears.
