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Sugar factory owners fuel land grabbing

By Haggai Matsiko

International body wants consumers to petition Coke, Pepsi

A new report by Oxfam International has lifted the lid on how the ever spiralling demand for sugar and the overwhelming rush for land to grow it, is fuelling land grabbing. Oxfam’s new report, Sugar Rush: Land rights and the supply chains of the biggest food and beverage companies, while based on findings in Brazil and Cambodia and Africa in general, echoes the outcries by Ugandan politicians and activists.

The report comes at a time when President Yoweri Museveni is yet to give up on two key deals involving parcelling of thousands of tracts of land to two sugar investors—the Metha Group and Madhvani Group.

But Oxfam’s findings also have a direct impact on Ugandans. The organisation has accused Coca-Cola, PepsiCo and Associated British Foods (ABF), the biggest sugar producers and buyers for increasing the demand for sugar and subsequently the rush for land to grow it.

“It’s time for some of the world’s largest sugar buyers and producers – PepsiCo, Coca-Cola and ABF – to acknowledge their responsibility for addressing the growing threat of land conflict in their supply chains and the disastrous impact these cases can have on communities,” Oxfam notes.

Coca-Cola, which has the biggest market of these, churns out about 60,000 bottles an hour in Uganda and it made profits of over $10 million in 2012. Oxfam is calling on consumers including those in Uganda to sign on its petition to these companies and had already collected over 470,000 signatures of the 65000 it needs to petition the companies. Ugandans are among the billions that enjoy these drinks on a daily basis.

Oxfam wants the three companies to among others know and show risks related to land issues, commit to zero tolerance for land grabbing, disclose from where and from whom the company sources its sugar, advocate for governments and traders to tackle land grabbing, and support responsible agricultural investments.

The report shows that in Brazil and Cambodia, companies that supply sugar to Coke and Pepsi have robbed farmers of their rights and kicked them off their land.

It adds that ABF, the biggest sugar producer in Africa, is reported as linked to a range of other unresolved land disputes. Whole communities have lost their main source of food and income.

“Companies like Coke, Pepsi and ABF hold significant influence over the sugar industry, but their policies are so slack that they don’t seem to know if their sugar is grown on grabbed land,” Oxfam notes.

Sugar, soy and palm oil, Oxfam notes, are the three agricultural commodities which pose the greatest risk of being linked to land grabs.

But the organisation notes that of the three, sugar uses the most land for food production—about 31 million hectares of land globally.

In the last 13years, the organisation notes that about 100 recorded large-scale land deals for sugar production occupying at least 4 million hectares.

With demand for sugar set to rise “by 25 per cent by 2020, thanks in part to our insatiable sweet tooth,” Oxfam notes that this growing demand for sugar will propel even greater competition for land.

While the investigations for the research focussed on Brazil and Cambodia, activists say that the situation is not any different here. They cite several cases to justify this.

With the demand for sugar increasing by the day, Uganda has in the past few years witnessed an unprecedented increase in the number of sugar companies and subsequently, land rush and conflicts over sugar.

Sugar manufacturers in Uganda have in the past few years doubled from four to more than eight due to the insatiable demand for sugar.

Today, the country produces 350,000 tonnes of sugar but this production is expected to double by 2030. According to the Uganda Sugar Cane Technologists Association (USCTA), Uganda exported 41,055 tonnes and imported 72,895 tonnes in 2011.

It projects that if Madhvani’s Amuru sugar plant and others get on board, Uganda will be producing 464,500 tonnes two years from now and 700,000 in 2030.

Hopefully, this increase in sugar production can come without the costs Oxfam  is tackling in its new report.

Oxfam might have lifted the lid on the situation in Brazil and Cambodia but in Uganda, the rush for land to grow sugar is not a secret and Ugandan started fighting it as early as 2007.

2007 saw bloody riots following a decision by President Yoweri Museveni to give the Mehta Group 7100 hectares of Mabira forest’s 30,000 hectares to enable them expand their Lugazi-based Sugar Corporation Uganda Limited (SCOUL).

The company had asked for the land claiming it would enable them increase sugar production from 55,000 tonnes per year to 110,000 tonnes of sugar. Deadly riots stopped the giveaway of the last remaining forest in close proximity to Kampala that is also home to hundreds of rare species of birds.  But this was only temporary; President Museveni has not abandoned the plan.

Early this year, he expressed his frustration about the activists and politicians fighting the Mabira give away. He also blamed politicians who were blocking the allocation of the Amuru land to another sugar investor.

President Museveni has since 2011 wanted over 40,000 hectares of land in Amuru, Acholi region given to the Madhivani Group to grow sugarcane. The land in Amuru, would see between 10,000-17,000 people evicted. After several run-ins with the locals that saw some lose their property, the government relaxed. But plans are still underway to deliver the land to the investor.

These are not the only cases.

In 2011, Tirupati, a company mainly known for real estate development acquired about four square miles of land to grow sugar. This acquisition threatened to evict about 20,000 people and was stopped only after their outcry forced President Museveni to halt the transaction.

In 2009, Masindi district officials and activists were also up in arms against a government decision to award 3000 hectares of land to Kinyara sugar factory.

When in 2011, a new sugar firm, Sugar and Allied Industries Limited (SAIL), opened up in Kaliro, the company was also engulfed with allegations that it had grabbed land.

Apart from land issues, there is a huge debate on whether sugar has improved regions where it is widely grown.

Several critics have blamed mushrooming sugar factories for the food crisis in some parts of Busoga region and others say the sugar industry is largely to blame for the overwhelming poverty in Busoga.

However, MPs from the region declined President Museveni’s directive to close some of the factories insisting they have been beneficial to their locals.

Of Uganda’s 13 licenced sugar industries, eight are based in Busoga. The sugar companies in Uganda include; Kakira Sugar Works, Kinyara Sugar Works Limited, Sugar Corporation of Uganda Limited, Sango Bay Estates Limited, Mayuge Sugar Industries Limited, Sugar & Allied Industries Limited , Mukwano Sugar Factory, Uganda Crop Industries , Kafu Sugar Factory, Kamuli Sugar Factory, Sugar Allied Industries , among others.

Some of these companies have been hit by strikes over poor pay and demands for better prices for out growers. In May this year about 10,000 sugarcane outgrowers, under Busoga Sugarcane Growers Association, demanded a pay rise from the Shs70,000 a tonne of sugar cane that Kakira Sugar Limited was paying them.

Oxfam targets Coca-Cola and PepsiCo for being linked with companies with land disputes. The Independent could not establish whether any of the Ugandan companies has ever supplied these companies. But that is not what is important, activists say.

Oxfam’s biggest message is that companies like these or those with aspirations to play on the international stage, need to be responsible and do more to stop indigenous communities from being forced from their homes. To get the companies to act, Oxfam is calling on consumers.

“We need to be sure that what we eat and drink does not make the poorest and most vulnerable across the world homeless or landless,” Sally Copley, Oxfam’s campaigns director, said, “PepsiCo, Coca-Cola and ABF are the three big giants in the sugar industry and must lead the way in making sure we are not left with a sour taste in our mouths.”

Just as Oxfam calls on PepsiCo, Coca-Cola and ABF, Ugandan activists say, big sugar investors like Mehta and Madhvani could borrow lessons.


  • 4,000,000 – Hectares of land covered by sugar production globally following over 100 large-scale deals recorded since 2000
  • 25 – The percentage by which global demand for sugar will grow by 2020
  • 350,000 – Tonnes of sugar produced in Uganda
  • 71000 – Hectares that President Yoweri Museveni wanted cut off Mabira forest for the Metha Group to grow sugar
  • 40,000 – Hectares of land  in Amuru, Acholi region that President Museveni wants to give to the Madhivani Group to grow sugarcane
  • 60,000 – Bottles that Coca-Cola Uganda churns out per day
  • 8 – Sugar factories in Busoga region alone
  • Shs 70,000 – Cost of a tonne of sugar cane

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