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The extensive overhaul of Nzoia Sugar Company's dilapidated plant, established in 1975, will delay full operations under new investor Jaswant Singh Rai, impacting thousands of cane farmers and the regional economy.
The full revival of Nzoia Sugar Company, a key player in Kenya's sugar industry, is projected to take up to three years due to the extensive replacement of its severely outdated machinery. Principal Secretary for Trade and Investments, Juma Mukhwana, announced on Friday, October 11, 2025, that the new investor, businessman Jaswant Singh Rai, is undertaking a complete overhaul of the milling plant, which was originally established in 1975.
Mukhwana, speaking during a live interview on the Ikuwekuwe Facebook page, explained that the factory requires modern equipment, with new machinery already imported from India. He emphasised that such a comprehensive rebuilding process cannot be completed in a few months.
Nzoia Sugar Company, located in Bungoma County, serves over 67,000 farmers in Bungoma, Kakamega, and neighbouring counties. The prolonged revival timeline could influence public debate and policy execution, with stakeholders calling for clarity on specific timelines, costs, and safeguards for the affected communities.
Nzoia Sugar Company was incorporated in 1975 and began operations in 1978 with an initial milling capacity of 2,000 tonnes of cane per day (TCD), later expanded to 3,000 TCD in 1989. Despite previous efforts, the factory has faced years of financial distress, mismanagement, and underutilisation. The Kenyan government holds a majority share of 97.94% in the company.
The current revival is part of a broader government strategy to revitalise struggling state-owned sugar factories through private partnerships. In May 2025, the Ministry of Agriculture and Livestock Development secured a KSh 12.29 billion investment to revive four key state-owned sugar factories, including Nzoia Sugar. West Kenya Sugar Company, owned by Jaswant Singh Rai, was awarded a 30-year lease to manage Nzoia Sugar Company, committing KSh 5.76 billion to its revival.
The leasing program for state-owned sugar mills aims to modernise facilities, boost efficiency, and increase sugar output. The government has also committed to settling outstanding payments owed to farmers and workers. An agreement with the Kenya Union of Sugar Plantation and Allied Workers ensures that 80% of the current workforce will be retained, with the remaining 20% phased out through negotiated retirement packages.
The revival of Nzoia Sugar brings relief to over 67,000 sugarcane farmers who have faced hardships due to the factory's prolonged shutdown. President William Ruto previously assured farmers that situations where they deliver cane and are not paid would not recur, emphasising reforms to ensure timely payments to both farmers and workers.
The three-year timeline for Nzoia Sugar's full operationalisation means a longer wait for the full economic benefits to be realised by cane farmers and the regional economy. While the investment is substantial, the history of mismanagement and operational limitations at Nzoia Sugar underscores the need for stringent oversight to ensure the new investor meets the agreed-upon targets and timelines. Jaswant Singh Rai's growing dominance in Kenya's sugar industry, controlling over 50% of the market with the Nzoia takeover, has raised concerns about potential monopolistic practices.
While the PS indicated a three-year timeline for full operation, the exact phased schedule for the plant's overhaul and the specific milestones for each year remain largely undefined. The full financial implications of the overhaul, beyond the initial KSh 5.76 billion investment, are also not publicly detailed. Past reports have highlighted a KSh 295 million state-owned plant at Nzoia Sugar that remained idle for 28 years after purchase, raising questions about asset utilisation and planning.
Stakeholders will be closely watching the progress of the plant's modernisation, particularly the adherence to the announced timelines and the impact on cane farmers' livelihoods. The government's oversight role in ensuring the investor's compliance with the lease agreement and addressing concerns about market dominance will be critical. The Kenya Sugar Board has set an end-of-October 2025 deadline for the full revival of all four leased mills, including Nzoia and Chemelil, which are undergoing phased machine rehabilitation.
The revival of Nzoia Sugar is part of a broader national effort to reform Kenya's sugar sector, which includes similar leasing agreements for other struggling state-owned mills like Chemelil, Sony, and Muhoroni. These reforms aim to boost local sugar production and reduce reliance on imports.
