The Ministry of Trade says the slight increase in sugar prices has nothing to do with production capacity.
Currently a kilogram of sugar goes for around Shs3, 000 up from Shs2, 500 a month ago.
The Commissioner Bilateral Trade, Mr Cyprian Batala says Uganda’s sugar production capacity stands at 420,000 tons, consuming 300,000 metric tons annually with a surplus of 100,000 tons of sugar.
This comes just days after Uganda sugar barons asked for full access to Kenyan market- based on the East African Community’s free market rule- in the wake of soaring sugar prices in what could compound consumers’ problems.
Uganda sugar firms want the Kenya market opened up to help in balancing trade between the two countries, which is currently in favour of Kenya.
Uganda has been one of Kenya’s biggest suppliers of sugar, with exports from the country rising from 73 tonnes in November 2011 to 30,299 tonnes in November 2012. They have been rising since then.
Early this month, sugar prices shot up with sugar millers attributing the problem to high demand.
“Demand is high towards the festive season because people are stocking sugar for the holidays. This is an opportunity for the companies that have been making losses since the beginning of the year to start making some profits,” Mr Jim Kabeho, the chairperson of Uganda Sugar Millers Association said.
Consumers have to part with an extra Shs600 for a kilo of sugar which shot up from Shs2,200 to Shs2,800 and 3,000 depending on where you buy it. Retailers have to pay Shs30,000 more for a 50 Kilogrammes bag of sugar whose price scaled up from Shs90,000 to Shs120,000.
SOURCE: Daily Monitor