Sugar farmers and industry stakeholders have raised concerns over proposed changes to the management and financing of the sugar sector under the Crops Laws Amendment Bill, 2026.
The stakeholders made their submissions before the National Assembly’s Departmental Committee on Agriculture and Livestock, chaired by Tigania West MP John Mutunga, during a session to consider views on the proposed legislation.
The Bill, sponsored by Leader of the Majority Party Kimani Ichung’wah, seeks to amend the functions of sector-specific agricultural institutions and channel relevant funds to the proposed Kenya Agribusiness Development Corporation Limited (KADCO).
Mutunga said the proposed establishment of KADCO was aimed at addressing longstanding challenges affecting the financing of agriculture.
Under the proposal, KADCO would bring together the Agricultural Finance Corporation (AFC) and the Commodities Fund under an institution anchored under the National Treasury.
“As a Committee, we are seeking to protect the agriculture sector, which we know is poorly funded, rather than take away from the sector by combining the strengths of these two agencies,” Mutunga said.
However, some sugar industry stakeholders questioned whether the proposed changes would strengthen existing institutions or create new challenges for farmers and other players in the sector.
Nick Oloo of the Kenya Sugar Manufacturers Association (KESMA) questioned whether the proposed institutional changes would add value to existing arrangements serving the sugar industry.
Oloo raised concerns over a proposal to transfer funds from the Sugar Development Levy to KADCO.
He argued that the move could affect accountability in the sector and alter arrangements established under the Sugar Act, 2024.
Oloo also cited the impact of previous legislative changes on the sugar industry.
He said the sector had experienced challenges in financing, cane development, factory rehabilitation and farmer support following the enactment of the Crops Act, 2013.
Atiang Atyang of the Kenya Association of Sugarcane and Allied Products (KASAP) urged lawmakers to protect gains made under the Sugar Act, 2024.
“We must protect what was achieved by the Sugar Act 2024. Before its enactment, the sugar sector was receiving the least portion under AFA and the Commodities Fund despite being among the largest sectors,” he said.
Atyang also questioned aspects of the proposed institutional framework and drew comparisons with the Agricultural Development Corporation (ADC) and its role in the sugar industry.
William Kopi, chairperson of the Butali Sugarcane Farmers Association, said the proposed financing model could affect the relationship between investors, the government and farmers.
He warned that the changes could have implications for sugarcane production if the financing arrangements do not adequately address the needs of farmers.
Not all stakeholders opposed the proposed changes.
Michael Arum of the Sugar Campaign for Change supported the amendments, arguing that the focus should be on establishing an effective financing framework for smallholder farmers.
“The issue here is not simply which institution should manage the funds. It is simply proposing a financing architecture that will make smallholder farmers organized and finance-able,” Arum said.
He cited Malawi and South Africa as examples of countries that have adopted similar financing approaches.
According to Arum, such models have supported the development of the sugar industries in the two countries.
The proposed amendments have triggered debate over how agricultural funds should be managed and whether changes to existing institutions could strengthen or weaken support for farmers.
The Agriculture and Livestock Committee is expected to consider the views presented by farmers, manufacturers and other stakeholders as it continues scrutinising the Crops Laws Amendment Bill, 2026.
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