NAIROBI, Kenya – Agriculture Cabinet Secretary Mutahi Kagwe has been summoned by senators to explain the government’s contentious decision to lease four state-owned sugar factories to private millers for 30 years, a move that has ignited political and public backlash in sugarcane-growing regions.
The Senate Standing Committee on Trade, Industrialisation and Tourism, chaired by Kwale Senator Issa Juma, is demanding a full account of the leasing process—including the lease agreements, asset registers, evidence of public participation, and the role of the Privatisation Commission.
At the centre of the storm are four mills—Nzoia, Chemelil, Sony and Muhoroni—that have been handed to private firms in deals worth Sh12.29 billion in investments.
West Kenya Sugar Company took over Nzoia, Kibos Sugar got Chemelil, Sony was leased to Busia Sugar Industry, while West Valley Sugar Company acquired Muhoroni.
But questions have swirled around the transparency of the process, with senators accusing the Ministry of Agriculture of bypassing court orders, locking out local stakeholders, and potentially opening the door to land grabs under the guise of revival.
“Opaqueness and exclusion”
Busia Senator Okiya Omtatah, one of the fiercest critics, said the decision was rushed and lacked adequate public engagement.
“What safeguards are in place to protect farmers, employees, and local economies? We need to know what happens to public assets and service delivery once these leases kick in,” he said.
Nairobi Senator Edwin Sifuna echoed the concern, warning that the leases could end up benefiting land speculators instead of reviving the mills.
“If the goal is revival, why lease the land to someone who might only be interested in the real estate value? The risk of asset stripping is real,” Sifuna said.
Senator Godfrey Osotsi (Vihiga) questioned why the public was “blindsided,” adding that previous experiences, such as the troubled privatisation of Mumias Sugar, had shown the dangers of sidelining local voices.
Kakamega Senator Boni Khalwale accused the ministry of token consultations.
“Meeting the Governor of Bungoma and the National Assembly Speaker is not public participation,” he said, claiming leaders had rubber-stamped Nzoia’s lease to West Kenya’s Rai Group without local consent.
Government: Reforms overdue, fully legal
In response, CS Kagwe defended the leasing as long-overdue reform backed by Parliament and consultations dating back to 2015.
“The process followed all legal procedures. No public land has been sold. All leases are for use of assets, not ownership,” he said.
He revealed that each mill would remain under government ownership, with lessees paying annual fees based on market rates.
The Kenya Sugar Board will collect these proceeds for reinvestment in local communities and sugarcane development.
The four private firms have committed a combined Sh12.29 billion to rehabilitate the mills, and will pay a total goodwill fee of Sh521.9 million.
Additionally, the government has allocated Sh1.7 billion to settle farmer arrears and pledged another Sh1.5 billion by July.
Workers will also receive Sh1 billion in salary settlements through a deal with the sugar workers’ union.
Kagwe also promised that lessees would pay concession fees tied to sugar and molasses output—Sh4 per kilo of sugar and Sh3 per kilo of molasses—expected to generate Sh1.5 billion annually for farmer bonuses.
Support from governors, pushback from locals
While the Council of Governors has endorsed the leasing strategy, saying it will boost efficiency and cut dependence on sugar imports, Western Kenya leaders remain unconvinced.
Bungoma farmers have strongly opposed the leasing of Nzoia, fearing the loss of community-owned land and livelihoods.
“Nzoia has the largest nucleus estate. The people will not allow it to be taken,” said Sifuna.
Nandi Senator Samson Cherargei called for the leasing to be put on hold until court cases are resolved and more counties, including Nandi, are included in the decision-making.
A clash of visions
The bitter dispute reflects a wider divide over how to save Kenya’s struggling sugar industry.
While the government touts leasing as a path to profitability, many local leaders argue that public investment—not privatisation—is the answer.
“The sugar sector doesn’t need to be sold off. It needs better management,” Osotsi said.
