1. Background

The sugar industry in Tanzania provides direct employment to about 30,000 people. While sugar cane out growers total about 16,768, secondary employments, under the sector involves a total of about 81,360 people. The industry also creates substantial indirect employment in the form of people engaged in the wholesale and retail trade in sugar, providers of transport services and people working in social services in the sugar estates townships.

Provides cane farmers with total earnings of about Tshs 29.4 billion (2009/10) whose benefits spread covers a population of over 160,000 people. Sugar production and employment plays a vital role in rural areas in the development and provision of social amenities including:- schools, hospitals, water supply, townships and farm roads. 

Sugarcane is an important commercial crop in Tanzania. It is the main source of sugar produced for both export and domestic consumption. Currently, most sugarcane is grown in estates, owned by the sugar processing factories (SPF) as well as contract growers (CG). At present there are four large sugar estates in the country. These are former para-statals that have all been privatized in the late 1990’s and now make use of nucleis estate and out growers schemes to get enough supply of raw cane to the processing plant.

Sugarcane is one of the important food and commercial crops of Tanzania. Its production is concentrated mainly in three regions, Morogoro, Kagera and Kilimanjaro. Most of the sugar produced in the country is for home consumption and only a small proportion is exported to service foreign debts.

The total current sugarcane production in Tanzania is far below the country’s annual demand for the commodity. However, research carried out in the country during the past ten years shows that the country has the potential to become a net exporter of the commodity if the current constraints limiting production at the farm level were removed.

Knowledge of the sugarcane growth requirements may improve management of the crop to boost production at farm level. 

Another issue is the high cost of doing (sugar)business in Tanzania and therefore it is still attractive to import (dumping?) of cheap sugar from the world market. 

At present al of the sugar companies run their processing plants at below capacity level. 

Sugarcane requires ample supply of water, 1200 - 1500 mm per annum. In freely drained soils, a high precipitation can be tolerated. The duration of the rainy season is important in sugarcane growth. For example, at the Kilombero Sugarcane Estates where annual rainfall could be as high as 1500 mm per annum, sugarcane is also irrigated because most of the rainfall is restricted to the period between March and May. Adequate moisture and temperature are the two most important ecological requirements that are essential for efficient growth and productivity of the sugarcane crop. If excess water is not immediately drained at the sprouting stage, it will result in rotting of stem cuttings called setts, usually used for the next season’s plantings.

On the other hand, if rainfall is insufficient during theseason, supplementary irrigation becomes necessary to ensure effective development of stems. In this context, water stress occurring in the plant during stem elongation severely reduces cane pro- sugarcane production.


Sugarcane Production Statistics

Year 2002 2003 2004 2005 2006 2007 2008 2009 2010
Produced Tones 1, 750,000 2, 000,000 2, 000,000 2, 346,000 2, 501,000 2, 535,000 2, 595,000 2, 749,000 2, 750,000

Source: Sugar Board of Tanzania (SBT)


2. Potential for Investment in Sugar cane Farming and Processing. 

Tanzania is looking for more investors into sugarcane production so as to meet domestic demand for the commodity as well as generate a surplus for export. This is because the demand is still high. The sugarcane farming and processing in Tanzania is very small and cannot meet the annual demand for sugar.

The country is well situated for the production of sugarcane. It has a wide variety of climatic and weather regimes with an area of 945,087 km2 (Berry, 1991) and a population of over 44 million people most of whom are employed in the rural sector (80%). Apart from the high mountain areas, temperatures are not the major limiting factor to sugarcane production. Rainfall and well drained soils may be considered the limiting factor for most crops, sugarcane inclusive. About 21% of the country can expect 90% probability of receiving slightly higher than 750 mm of rainfall and only about 3% can expect more than 1250 mm. About one-third Sugarcane Production 5 of the country is dry (mainly the central plateau), with less than 500 mm of expected rainfall per year. During most of the year, evapo-transpiration exceeds precipitation in the drier areas. Due to seasonal rainfall shortages, sugarcane farms in Tanzania are situated along river valleys to facilitate supplementary irrigation during the season. To date, only three regions are considered suitable under the above criteria for sugarcane production, i.e., Morogoro (Kilombero & Mtibwa Valleys), Kilimanjaro (under Irrigation Scheme) and Kagera (River Kagera Basin).

There are two major sugarcane estates in Morogoro, Kilombero Sugar Company and Mtibwa Sugar Estates. These together produce over 80,000 tons of processed sugar annually. Kilimanjaro, the Tanganyika Planting Company (TPC) is one of the largest sugarcane estates in the country. Over 35,000 tons of processed sugar is produced annually. The Kagera Sugarcane Estates are fairly small, producing only about 2,000 tons of processed sugar annually.


3. Financing needs for the Sugar Sector.

Entrepreneurs and small holder farmer groups may seek financial assistance for:

  • The planting material and land preparation (including labour costs) for sugar cane farming
  • The purchase farm inputs (fertilizer, agro-chemicals)
  • The purchase of mechanization equipment (tractors, power tillers, forklift and mechanical harvesters)
  • Purchase means of transport (loaders & trucks) -
  • Installation or expansion of irrigation systems and/or equipment.


4.  How can PASS help Farmers  in the further expansion/Intensification of the Sugar Sector.

  • Through feasibility studies and business plans PASS can assist entrepreneurs access to bank loans (financial linkages).
  • PASS can assist in management training for entrepreneurs and smallholder groups in the sugar sector
  • Capacity building and formation of farmers groups and set up of SACCOS.
  • Assist with strengthening links between farmer groups and processing plant
  • Promotion of Nucleis Estate – Smallholder Sugarcane Farming ( a kind of ‘contract farming’)
  • Support farmers with inadequate amount of collateral / security for a commercial bank loan.


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