Sugarcane farmers across Uganda are demanding the immediate abolition of a controversial 5 percent ‘trash’ deduction imposed by millers, saying the practice costs growers an estimated Shs48 billion annually and continues despite a presidential directive ordering its removal.
The Uganda National Association of Sugarcane Growers (UNASGO) says farmers lose between Shs6,000 and Shs10,000 on every tonne of cane supplied to factories through deductions meant to account for leaves, tops and other non-cane materials.
According to the association, the deductions translate into losses of about Shs194 million per day, Shs4.8 billion per month and nearly Shs48 billion annually.
UNASGO chairperson Julius Katerevu said outgrower leaders from Busoga, Bunyoro, Northern and Central Uganda had agreed to push for harmonisation and eventual removal of the deduction within two weeks.
‘The key issue is the persistent five percent trash deduction without clear criteria,’ Katerevu said. ‘Farmers are not opposed to quality control, but we want a transparent and uniform measurement system.’
He argued that materials classified as trash are not waste because they are used by sugar factories to generate electricity and produce fertiliser and bagasse.
‘Trash is not waste. It is used to produce electricity, bagasse, fertiliser and manure. Farmers should not be penalised for it,’ he said.
Dispute reignited by implementation gaps
The dispute centres on a directive issued by President Yoweri Museveni on August 6, 2025, ordering millers to scrap the levy following complaints from farmers during a meeting at Kityerera State Lodge in Mayuge District.
However, growers say implementation has been inconsistent.
According to UNASGO, sugar mills in Busoga and Central Uganda continue enforcing the deduction, while factories in the Bunyoro sub-region have complied with the presidential directive.
Robert Atugonza, a farmers’ representative on the Uganda Sugar Industry Stakeholders Council for Bunyoro and Tooro, said growers would engage non-compliant millers, including major processors such as Kakira and Lugazi sugar factories.
‘If they fail to comply, we shall escalate the matter to a national meeting of farmers to decide the way forward,’ he said.
The matter is also expected to be tabled before the Uganda Sugar Industry Stakeholders Council within 21 days.
Farmers warn of declining returns
Growers say the deductions come at a time when the sector is already under pressure from falling cane prices and rising production costs.
Katerevu said farmers were increasingly harvesting immature cane after seven to 10 months instead of the recommended 18 months because of financial hardship.
‘The quality and quantity of cane are both declining. Farmers are harvesting early because they are struggling financially,’ he said.
‘Farmers are slowly losing hope in sugarcane growing. If nothing is done, the industry will continue to decline.’
Busoga farmers’ representative Isa Budhugo accused some millers of exaggerating quantities classified as trash.
‘Even if you weigh it, it cannot exceed 100 kilogrammes, yet they deduct one to two tonnes,’ he said.
CN Sugarcane Growers Association chairperson Twaliki Isabirye called not only for the deductions to stop but also for affected farmers to be compensated.
‘The directive was clear. The deductions should stop, and farmers should be refunded the money that has been unfairly deducted,’ he said.
Pressure from falling prices and higher taxes
The row comes as growers grapple with declining profitability.
Farmers say cane prices have fallen from about Shs175,000 per tonne a decade ago to around Shs125,000 today, significantly reducing earnings.
Concerns have also emerged over the government’s decision to increase excise duty on sugar from Shs100 to Shs200 per kilogramme, with growers fearing millers could further reduce cane purchase prices to offset higher costs.
Kaliro Outgrowers Association treasurer Tananansi Luwolere Walusimbi said many farmers were questioning whether sugarcane growing remained economically viable.
‘Many farmers are considering abandoning sugarcane growing because returns are no longer attractive,’ he said.
Mayuge Sugarcane Growers Association General Secretary Siraje Noah Ganaliwo said uneven enforcement of the directive was creating confusion and unfair competition within the industry.
‘The lack of uniformity creates unfair competition and confusion in the industry,’ he said.
In Bunyoro, where Kinyara Sugar Limited has complied with the directive, farmers say relations with the miller have improved.
Phinehas Kyotasobora, vice chairperson of the Masindi Sugarcane Growers Association, questioned the scientific basis for the deduction.
‘The assumption is that cane contains leaves and roots, but no one has explained how the five percent is scientifically determined,’ he said.
‘If a farmer supplies cane worth Shs10 million, about Shs500,000 is deducted. That could pay school fees, workers and farm inputs.’
UNASGO says it will present a formal position to government and millers if no action is taken within the next two weeks, warning that continued inaction could deepen instability in Uganda’s sugar industry.
Efforts to obtain a comment from Uganda Sugar Manufacturers’ Association chairperson Jim Kabeho were unsuccessful as his known telephone number was unavailable.