Parliament has come in to end several years of clashes between Sugar producing giants Kakira Sugar Works and Mayuge Sugar Industries in Eastern Uganda.
The two companies have since 2005 feuded over among others land ownership and control of sugarcane out growers.
The Parliamentary Tourism Trade and Industry Committee in a recently released report into the feud, recommended tough action against Mayuge Sugar industries including cancellation of their license, if they remain unwilling to adhere to national laws and policies.
The country’s leading sugars manufacturers Kakira accuse Mayuge Sugar Company of encroaching on their land by setting up a factory within a radius of 10 km from Kakira, which violates the Sugar Policy.
The National Sugar policy stipulates that sugar factories should be located in a radius of at least 25Km from each other.
On top of this, they claim that Mayuge Company is expanding deep into their territory without creating their own sugarcane growing field hence encroaching on Kakira sugarcane growers space.
Kakira tried several times to drag Mayuge Sugar industries to courts of law without success, as the latter claim that they set up their factory in 2005, long before the Sugar Policy was enacted.
Parliament last year moved to resolve the matter following a directive from President Yoweri Museveni that a quick remedy should be found for the escalating misunderstanding before it gravitated into a major threat to sugar production.
Kakira also accuses their counterparts of stealing their sugarcane farmers by paying them more for each ton of sugarcane.
Kakira reports that out growers who used to supply them have shifted allegiance to Mayuge Sugar industries because it pays them Sh 33,000 per ton of sugarcane which is higher than Kakira’s. This, they say, had forced them to produce below capacity.
After visiting the two factories and holding talks with company bosses, the Committee has directed that Mayuge Sugar Industries adheres to the Sugar Policy by setting up the minimum 2000 acres as required of each new sugar factory.
The MPs also directed Ministry of Trade to take over the role of issuing licenses to sugar companies, from Uganda Investment Authority, and to immediately deregister Mayuge Sugar Company if it insists on snatching farmers aided by Kakira Sugar Works.
“Kakira has invested a lot of money in aiding out-growers by teaching them modern sugarcane growing and harvesting practices and giving them inputs,” observed the Committee Members in the report seen by Chimpreports.
“Much as Mayuge Sugar Farmers pays a higher price for the sugarcane, the services provided by Kakira including hospitals, schools, electricity, scholar (CSR) exceed the 83,000.”
Kakira was also advised to sign binding agreements with their out-growers so that they don’t sell their sugarcane to Mayuge.