Cooperatives & Communities

Review contracts to settle disputes, MTIC official urges Hoima Sugar Limited and farmers

KIKUUBE– A senior official from the Ministry of Trade, industry, and Cooperatives [MTIC] wants Hoima Sugar Limited and cane out-growers in Kikuube district to revise their contracts if the long-standing disputes between the two sides are to end.

Persistent disputes between the two sides have left many farmers injured as security in the district enforces a court order stopping rival Kyenjojo Sugar Factory from dealing with farmers contracted to supply cane to Hoima Sugar Limited.

David Kiiza, the senior industrial officer at MTIC on Friday met over 500 cane farmers, top managers of both Hoima and Kyenjojo sugar factories, security committees of Kikuube and Kyenjojo districts, seeking ways of ending the cane disputes.

The Kikuube resident district commissioner, Amlan Tumusiime called for the said meeting to find solutions to the conflict where cane farmers and sugar companies are at loggerheads, affecting the sugar industry in that region.

Hoima Sugar Limited managers have been in arms accusing farmers of selling sugarcane harvests to Kyenjojo Sugar Factory despite the existence of running contracts with the company that has also had running battles with encroaches on its land.

Meanwhile, the farmers have been accusing Hoima Sugar Limited of lending a deaf ear to their concerns, something, which they claim, has forced them to sell their sugarcane to other factories in the region.

Francis Isingoma, the chairperson of Hoima Sugarcane Out-growers Association told the meeting that Hoima Sugar Limited was to blame for the conflicts between the two sides.

Among other complaints, he accused Hoima Sugar Limited of delayed payments, low prices, late harvesting of the cane, and refusal to buy burnt sugarcanes. These, he said, force farmers to sell sugarcane to other sugar companies.

For instance, he noted that Hoima Sugar Limited buys a ton of sugarcane at Shs 120,000 compared to Shs 170,000 offered by Kyenjojo and Bwendero sugar factories as Busunju and Mubende sugar factories buy a ton at Shs 200, 000 and Shs 180, 000, respectively.

Isingoma further told the meeting that farmers are always asked to pay bribes for different services like sugarcane harvesting, transportation supply of seeds, fertilisers, and tractors for cultivation, yet the services are free under the contracts signed.

Richard Kavuma, chairman Western Region Sugarcane Growers Association said the 25 percent interest charged on loans Hoima Sugar Limited gives the farmers is too costly to the poor farmers, demanding that the contract be revised.

Arthur Abariwano, counsel for Kyenjojo Sugar Factory defended his company saying farmers always contact them to buy their sugarcane, arguing that there is no law that bars the company from buying the sugarcane from farmers in the region.

He said Uganda is a free market economy and that Kyenjojo Sugar Factory buys cane from unregistered farmers.

He called for the protection of farmers’ rights so that they do not become slaves of the contracts, adding that contracts can be terminated.

“If you have contracts with Hoima sugar and you have issues with them, the very good procedure is to terminate with them and go where you want to go, you are not slaves,” he advised.

Ramadoss Rajasekaran, the manager of Hoima Sugar Limited said that 90 percent of the farmers in Hoima and Kikuube districts are registered with their company.

He noted that the company has offered financial support to farmers to grow sugarcane as well as improving over 360 kilometres of roads in the area to ease transportation, adding that the company cannot allow a competitor to buy cane from the farmers they are dealing with.

However, Ramadoss promised to address all the issues affecting the farmers adding that the company is ready to sit with the farmers and review the contracts.

He also promised that company is also going to stop charging the farmers interest after supplying the cane to the company.

He said the factory was under maintenance, promising that before the factory opens they will offer farmers a new price of cane, adding that they recently fired eight workers over corruption.

While addressing farmers during the meeting Kiiza challenged Hoima Sugar Limited to implement the commitment to ensure the protection of farmers but also advised the company to review its contracts with the farmers.

He explained that whereas the Kyenjojo Sugar Factory has a right to buy sugarcane from anywhere in the country, they are not supposed to buy it from registered farmers of another company.

He added that MTIC is planning to implement the Sugar Act, 2020 to address some of the challenges facing farmers and companies.

He also advised Kyejonjo Sugar Factory and farmers to challenge the court order stopping them to do cane business.

RDC Tumusiime commended the MTIC for intervening, saying the engagement will end the conflict which had turned into a security concern.

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