On Wednesday, May 1, the East African coast faced Tropical Cyclone Hidaya, a severe weather event that originated in the Southwestern Indian Ocean. The cyclone served as a stark reminder of the vulnerability of global supply chains to natural disasters. Let's delve into the cyclone's development, its impact on the East African coastline, and the subsequent disruptions to shipping and commodity movement.

Hidaya's genesis can be traced to a low-pressure system that intensified over the warm waters of the Indian Ocean. Designated as a tropical cyclone by Meteo-France La Reunion, it reached peak wind speeds of 165 km/h, placing it within Category 1 on the Saffir-Simpson Hurricane Wind Scale.

The cyclone's initial target appeared to be the Kenyan coastline, prompting evacuations and heightened preparedness measures. However, its path shifted, leading it to land on Tanzania's Mafia Island instead. While this spared Kenya a direct hit, Tanzania wasn't as fortunate. The island witnessed heavy rainfall, strong winds, and significant damage to infrastructure and property.

The impact of Hidaya transcended the immediate devastation. Shipping in the region was severely hampered. Ports in Dar Es Salaam and Mombasa faced closures due to rough seas and high winds, leading to delays and disruptions in freight movement. Additionally, concerns surrounding damaged infrastructure led to temporary disruptions in the flow of goods like sugar, coffee, tea, and minerals, all crucial exports for East African nations. This, in turn, cascaded into potential shortfalls in delivering essential commodities like food and fuel.

Tanzania's Meteorological Authority confirmed the dissipation of Cyclone Hidaya, but the long-term effects are still being assessed. The resilience of East Africa's infrastructure and the efficiency with which shipping resumes will be crucial factors in determining the overall impact on commodity trade.

This event underscores the importance of incorporating weather risk management strategies into commodity trading operations. By proactively considering the potential disruptions caused by natural disasters, traders can mitigate risks and ensure a more stable supply chain.

Effects of cyclone Hidaya to the East African coast

East Africa dodges direct hit by Cyclone Hidaya

Southern African sugar producers, Zambia, Zimbabwe, and Malawi, are experiencing a severe drought due to the El Nino weather phenomenon. El Nino (forecasted to continue until April 2024) has brought unusually high temperatures and below-average rainfall in the three countries since 2023-Q4. The drought has significantly affected agriculture, limiting water supplies and irrigation systems. Despite being milder than the 2015 El Nino, experts have classified the current drought as strong and could adversely impact various crops in 2024.

Zambia recently declared drought a national disaster, with nearly half of the crop acreage severely stressed. Southern Zambia, where Zambia Sugar (the country's largest sugar producer) is located, is among the worst-hit areas. A prolonged drought will negatively affect the recharge system for the Kafue River, which supports cane development at the Nakambala and Kafue estates.

Likewise, Zimbabwe received barely any precipitation during the rainy season, which normally runs from October to March. Water volumes in the Tugwi Mukosi and Mutirikwi dams, the primary source of irrigation water for Hippo Valley and Triangle sugarcane estates, have steadily declined. As of March 18, 2024, Tugwi Mukosi, Mutirikwi, and Manyame were 83.5%, 96.0%, and 93.6% full, respectively. The volume is still relatively high but marginally below the levels recorded during the first week of March.

On the other hand, Malawi’s sugar sector is experiencing contrasting weather patterns. Northern Malawi is receiving significant amounts of rainfall, particularly in the Nkhotakota district, where Illovo's Dwangwa mill is located. However, the southern parts of the country are alarmingly dry. Sugar production at the Nchalo factory could be adversely affected if the drought persists.

Sugarcane in these countries is mainly irrigated, with the irrigation systems relying primarily on hydroelectric power. A decline in reservoir water volumes due to the drought would mean a shortage of electricity needed to run the irrigation pumps. The Kariba dam (Zambia and Zimbabwe’s primary source of hydropower) is currently about 14.16% full, a notable decrease from 18.25% in March 2023. Last month, the Zimbabwe National Water Authority (ZINWA) said water volumes in Zimbabwe's major dams were declining due to increased farmer demand for water to sustain the summer crop. The continued decline in water supplies could hamper irrigation, cultivation, and cane sugar production for the 2024/25 season.

El Nino brought unusually high temperatures and below-average rainfall in Zambia, Malawi and Zimbabwe

Drought Threatens Sugar Production in Southern Africa

In East and Southern Africa, free trade agreements (FTAs) include COMESA (Common Market for East and Southern Africa), EAC (East African Community) & SADC (Southern African Development Community). The idea here is to solve nearby country crop deficits, whose crops may be less competitively priced than world market imports (when no duties are applied). FTAs also lean on the economic phrase ‘comparative advantage,’ which states that countries should export goods for which they have a lower cost of production (relative to other goods) and equally, countries should import goods for which they have a higher cost of production.

An example of this is Kenya, which is a deficit sugar region (i.e. its consumption is larger than its production) and therefore needs to import to balance this shortfall. Uganda is a key sugar-exporting country that helps to fill this demand, via COMESA and helps to support African growth. In this example, the assumption is that there are both surplus and deficit members within the FTA which will in theory correct each other’s balance sheets. This is a broad assumption, but this becomes apparent when countries suffer from production failures. This was seen this year in Kenya, a disaster crop which was around 330,000 tonnes lower year-on-year meant a greater need to import sugar. This, coupled with a poor crop in Uganda and also not enough surplus sugar among other COMESA member countries, meant that Kenya had to resort to the world market.

This ties in nicely with another ‘con’ of these FTAs which relates to the world market. FTAs rely on import duties on goods which are imported from countries not involved in the agreement, however, this becomes irrelevant should we see price disparity between local and world market prices. Whilst sticking with the Kenyan crop failure example, we saw an approximate $400/MT margin for world market importers given a low world market price relative to local price. This did come at a time when the Kenyan government granted duty-free import licenses yet the point remains that this price disparity was caused by a significant production reduction in Kenya followed by poor crops among the COMESA region. This was further exacerbated by a low world market price environment versus a strong local price. These viable imports were also seen last year in Rwanda, which imposes a 25% duty on top of the CFR (Cost & Freight) import price. A lack of availability within the COMESA region increased the price of (the little available) COMESA sugar to the point where it is over 1.25 times the price of world market imports.

FTAs, such as COMESA, can be effective when surplus/deficit members function normally. Yet in times of crises, as seen above, we see outside members (i.e. world market exporters) benefit from these markets. This counteracts the intent of an FTA, whereby a reliance on these imports was created. Coming back to this Kenya example, importers benefitted when margins were high but as more sugar comes into the country prices tend to fall - many importers may have felt the negative effects from this. One final point to quickly touch on is a depreciating currency which makes imports more expensive in dollar terms. This further emphasises the need for FTAs to correctly function so that deficit regions can alleviate the pressure from importing commodities priced in dollars.

Trade agreements intend to support countries doing business together.

Trade agreements in East and Southern Africa

Since November last year, Tanzania has been grappling with a sugar shortage that has seen a rise in the price of the commodity. El Nino weather patterns that began in the fourth quarter of 2023 brought heavy rains, disrupting sugar milling activities. Millers faced challenges in harvesting and transporting sugarcane due to flooded farms and impassable, muddy roads. Additionally, excessive water led to a decrease in the sucrose content of the cane, causing a significant reduction in daily sugar output at major factories.

The situation has raised concerns among citizens and policymakers alike. In response to the crisis, Tanzania has implemented various measures, including allowing world market duty-free sugar imports, setting price caps, and warning traders against arbitrary price hikes. Let's delve into the details of these developments and explore their potential impact on the sugar market and the economy.

Tanzania’s Kagera Sugar to acquire South Africa's Tongaat

The Tanzanian government has taken a proactive step to tackle the sugar shortage by doubling sugar imports from the initial 50,000 tons to 100,000 tons. The state issued import licenses for about 100,000 tons of duty-free world market brown sugar for Jan-Feb arrival. The move aims to meet the growing demand for sugar in the country and stabilize prices. By increasing imports, the government hopes to bridge the gap between supply and demand, ensuring consumers can access this essential commodity at reasonable prices.

Another significant development in the effort to curb the rising sugar prices is the setting of indicative prices by Tanzanian authorities. The price of a kilogram of sugar has more than doubled from about USD 1.06 and USD 1.18 in November to currently between USD 1.57 and USD 1.96. Tanzanian authorities have moved to cap the minimum and maximum prices for a kilogram of brown sugar at USD 1.10 - USD 1.26. At the same time, the wholesale sugar price range was capped between USD 1.02 and USD 1.10.

Price caps serve as guidelines for the industry, providing a reference point to prevent unjustified spikes in the price of a commodity. This measure is designed to create a transparent pricing structure, ensuring that consumers are not exploited during times of shortage. The government aims to create a fair and competitive market for sugar by setting a price limit.

Warning traders against arbitrary price hikes:

SBT issued stern warnings to traders, cautioning them against unreasonable hikes in sugar prices. This move is intended to deter hoarding and profiteering practices that can worsen the situation. By putting traders on notice, the government aims to maintain price stability and protect consumers from unfair increases. This regulatory approach seeks to ensure that market forces operate within reasonable bounds and, at the same time, aims to guarantee the efficient functioning of the sugar supply chain.

Since November last year, Tanzania has been grappling with a sugar shortage.

Tanzania's response to sugar shortage

There is an active Government sugar tender for 100,000 tons in Ethiopia at present. Still, we suspect, as has been the case for the last three years, that the tender will either be awarded to a bidder who simply will not perform or will be canceled due to the inability to open an LC due to the chronic dollar shortage in the country. Both traders and local agents alike are fatigued with the process, and most traders today are putting in prices so high as to be discounted in their entirety. Even if there was a possibility to open an LC, then the prices, which are slated to all be in excess of USD 900 per ton and up to above USD 1100 a ton, will likely be baulked at in any case.

Ethiopia, therefore, will continue to buy via Djibouti from private importers and via informal flows from Somalia. These flows have continued to grow as Ethiopian production continues to fall lower due in part to the war in Tigray and the severe drought that has plagued the region over the last 24 months. Sugar flows have been coming from both Brazil (150s) and refined from India, Saudi Arabia, and the UAE. Prices in Djibouti and Ethiopia have relatively kept pace with the increase in the world market. They are mildly positive on a replacement basis, which signifies that buyers are likely underpriced at destination and that both Ethiopia and Djibouti are running hand to mouth on stocks.

A similar situation to Djibouti in that white sugar prices are increasing at the destination; replacement is above the local market price in Mogadishu, but prices are moving up to reduce this deficit. In Berbera, prices are slightly better due to lower clearance costs than Mogadishu, with the domestic market there again mildly positive to replacement parity. The Somali market is oscillating between Brazil 150’s and Indian refined in containers, depending on which one is cheaper on a given day. The white premium also plays its part in dictating what sugar Somalia buys.

Brown sugar, however, is another tale altogether. Prices remain firmly on the floor, with prices around USD 100 PMT below replacement cost. Traders are scratching their heads as to why this is the case, but it seems that a decent amount of stock combined with old pricing at circa 22 cents is to blame.

Sudan continues to buy sugar regularly but has certainly fallen away from its heady peak import campaign before the start of the civil war. Transit flows have stopped across Central Africa Republic (CAR) and Chad primarily, which has led to a reduction in imports of around 300,000 tons. The conflict remains in full swing, and so it will take time for this flow to return if it ever does.

On top of this, many of the domestic Sudanese industrial producers (soft drinks/sweets, etc) are simply not able to run their production units as they are in Khartoum, where the fighting is still severe; water and electricity are also still a problem. The war is dragging on longer than most people expected, and that will keep sugar imports lower until December 2023 and beyond.

An outlook on the horn of Africa

Horn of Africa special market commentary

In commodity trading, staying ahead of the curve is essential. Accessing accurate and real-time sugar pricing information can make all the difference in smart trading decisions.


That’s where the Kulea Parity Calculator comes in: benchmarked against international prices, this tool is revolutionizing trade for thousands of market participants.

Unlike many other commodity-insights platforms, Kulea does not buy, sell, or leverage the price index for our gain. We take an unbiased approach to guarantee a reliable pricing benchmark that represents the market.


The concept and development of the parity calculator can be traced back to Nick Kwolek, Founder and CEO of Kulea. Nick has experienced first-hand the challenges that arise while navigating a market that lacked dependable and regularly updated prices for sugar and other agricultural commodities. This experience fueled his determination to create the parity calculator. Based on input from respected buyers, sellers, and traders, we have developed our parity calculator, which has 99% accuracy.

Updated bi-weekly, the Kulea parity calculator clearly shows specific country prices, gathered firsthand from our team on the ground, and input prices such as basis price, premiums, and all other costs involved when importing.

Kulea boasts of an interwoven network of market participants across the globe. This helps us benchmark our prices against international prices, giving us an accurate edge. The parity explorer gives you a graphical view of the market over the past year.

Market participants can filter by origin and can, therefore, compare and analyze which is the best option when looking to import. The tool also reveals when there is a positive or negative import parity given the current market level and the specific country’s sales price. Using this tool supercharges your buying/selling strategy.

Why Kulea's parity calculator tool is an invaluable tool for sugar commodity traders

The Kulea Parity Calculator - a game changer in commodity trading

In our previous article, we assumed that 100% of the price buyers pay can be determined by transacting in the 

the global price benchmark for a particular commodity

. In reality, prices vary with the regions they are sourced from. For example, Brazilian sugar may be preferred to that of Indian origin due to its superior bags, which hold the sugar. Another example may be that Brazilian export logistics is poor, so there is less supply and thus higher prices. This preference would likely entail a higher price level than its Indian equivalent, and these levels are referred to as ‘cash premiums’ – in non-jargon terms, this is the premium buyers are willing to pay to source a commodity from a particular region. This value, quoted over the futures market, is also known as ‘basis’ and this is the term we will use in the rest of the article.

Due to the futures market’s role in setting a standard level of global sugar prices, basis prices aren’t accounted for. This means that there is a component of our total purchase price that we cannot fix via futures – let’s look at an example below:

>>Buyer pays $700/MT FOB (i.e., doesn’t include freight cost) for 2,000MT sugar from Brazil.

>>39 lots of futures were fixed (i.e., bought) a month before this purchase at 27 c/lb (=$595/MT).

>>Our cash premium is, therefore, $105/MT.

>>1 month later, Brazil's sugar basis is $75/MT.

>>The buyer has essentially lost $30/MT in a falling basis environment.

The above example shows that, despite the buyer taking steps to hedge their long cash exposure, a falling basis is a risk for buyers and something that cannot be directly hedged. The opposite is true: a buyer will benefit in a rising basis environment (i.e., they bought before a regional price increase).

We can also see from the above example that the buyer has hedged 85% (=$595/$700) of their price exposure and may have paid an even higher price had they not hedged and there was a rise in the futures market. Luckily, buyers often have the option to source from multiple regions. This means that cash premiums can be observed before making a purchase, and a decision can be made from there. Basis risk could therefore, be alleviated if buyers split their total demand across different regions.

Understand the impact of regional cash premiums on commodity prices - hedging

The role of cash premiums when hedging commodities

Commodities can be complex markets to operate in: buyers are exposed to upward market spikes, and the opposite goes for sellers in that they are susceptible to falling prices. We often see market participants accept these risks, hoping that the market moves in their favor – this is called 

.’ In non-jargon terms, this is the equivalent of being uninsured and thus obligated to cover all losses in an unfavorable outcome (i.e., 

). This uncertainty directly affects profit margins, which can be positive or negative depending on the market movement. However, the point remains that the market participant has no control over this while unhedged.

This leads us nicely to the concept of being ‘

,’ whereby market participants can take an active role in eradicating price risk. It is worth mentioning that commodity markets, through time, have established standardized formats for their respective commodity. For example, Sugar has a minimum level of quality 

 that buyers demand and thus provides the benchmark from which price is established.

This standardization has led to the introduction of futures markets, which is believed to have been established in 1876 to help farmers reduce crop price uncertainty. Over time, this has developed into screen-based trading whereby the futures exchange for the respective commodity market matches buy/sell orders (e.g., ICE #11 raw sugar futures).

Hedging can be implemented in a couple of ways: 

The buyer/seller has their own futures account.

The buyer/seller will buy/sell futures via another buyer/seller’s futures account.

Many buyers/sellers in the Eastern & Southern African region will benefit most from the second option when looking to hedge; therefore, that will be our focus. A buyer’s physical sugar purchase of 

2,000MT is the equivalent of 39 futures contract

 (1 futures contract equates to 50.8MT). A buyer can ultimately choose when to ‘price’ their sugar by instructing the seller (who has the futures account) to buy on their behalf. 

Buyers may have a view that the market could crash, referred to as a 

, and can, therefore, benefit by delaying buy orders and pricing when the market has fallen. In an unhedged scenario, buyers would have bought at the time of purchase at a fixed price – unable to benefit from pricing their purchase later if the market fell.

In Part 2, we will introduce the notion of cash premiums and how these directly relate to futures market transactions.

Understanding commodity market hedging

Managing risk in commodity trading for buyers and Sellers

Tongaat Hulett Limited (THL), a leading sugar producer in Southern Africa, has chosen Tanzania's Kagera Sugar Limited (KSL) as the preferred Strategic Equity Partner (SEP) to purchase its sugar assets. On July 21, 2023, the company announced that KSL would acquire all of Tongaat's sugar businesses in South Africa, Zimbabwe, Botswana, and Mozambique. This development has caught key players in the industry by surprise, raising many questions on whether the appointed partner has the financial muscles to revive the troubled businesses of Tongaat Hulett, a sugar and property operator. The miller must have strong financial support to emerge as the best bidder out of 70 companies initially interested in partially/fully acquiring Tongaat assets.

Kagera Sugar is part of the Super Group of companies in Tanzania, the country's largest sugar producer, and owns sugar assets in DRC, Tanzania, and the Middle East. According to Tongaat's business rescue practitioners (BRPs), KSL was the most viable option based on the group's sound financial status, solid track record, and exposure to external sugar operations in the DRC and the Middle East, which would provide pertinent knowledge to help in the turnaround and restoration of THL's sugar businesses.

The big question is: What does this decision mean for the sugar sector? Will Kagera successfully restore Tongaat's businesses? Whereas Kagera Sugar is less known in the region, it is the third-largest sugar miller in Tanzania, with an average daily crushing capacity of 2500TCD. The company, however, is excited to expand its reach beyond its borders and gain a foot in its vision to become the leading sugar producer in Africa.

Tongaat has been battling to get back on its feet since 2019 after an accounting scandal that revealed a mountain of debt in the group's South African operations. In the 2018 financial statement, the firm's profits were overstated by 239%, while its assets were 34% over. This saw the removal and replacement of the company's top management involved in fraudulent activities that put the firm into piles of debt. Under new leadership, the firm began a restructuring strategy that saw the sale of some of its assets, reducing its debt by about R6.6 billion (USD 375 million) from R11.7 billion (about USD 666 million).

Despite this progress, the group needed more funding to clear the remaining debt balance. The debt level of its South African sugar operations was more than its asset values prompting Tongaat to enter business rescue. However, the firm's sugar investments in Botswana, Zimbabwe, and Mozambique were not financially distressed; therefore, they remained unaffected.

It is now up to Kagera to bring the giant South African sugar firm back to speed. This would greatly relieve the small-scale cane growers, who have suffered immense losses since the firm went into administration.

The big question is: what does this decision mean for the sugar sector?

Tanzania’s Kagera sugar to acquire South Africa's Tongaat

Sugar importation in Kenya has taken a new turn, particularly in a noteworthy move by the government to address the prevailing shortages. Interestingly, private entities and government-controlled millers are excluded from participating in this importation initiative. 

Agriculture and Livestock Cabinet Secretary, Mithika Linturi, unveiled a distinctive approach restricting importation rights solely to private individuals, permitting them to bring in an impressive 100,200 metric tonnes of sugar within a concise four-month importation timeframe. 

The driving force behind this importation strategy is to restore equilibrium to the nation's sugar industry, which has experienced an unprecedented surge in prices due to the inability of local millers to fulfill domestic demand. 

With the capacity to generate an annual sugar output of 600,000 tonnes, Kenya remains challenged by a shortfall of 200,000 tonnes, necessitating external sourcing.

Despite the government's aspiration to secure sugar imports from the Common Market for Eastern and Southern Africa (COMESA), this objective has encountered obstacles due to scarcity. Surplus-holding nations have been unwilling to sell their stock within this domain.

Last week, President William Ruto addressed the intricate challenges plaguing the sugar sector. At the heart of the matter, concerns persist regarding the sugar subsector. The issues span from confusion to disorder, including unauthorized transportation of sugarcane and non-compliance with established regulations.

President Ruto shared his thoughts on this at State House, stating, "The sugar industry is causing apprehension, and we've witnessed disruptions throughout the sector. Disorder has ensued due to the illicit movement of sugarcane and the flouting of regulations."

Kenya has a capacity to produce 600,000 tonnes of sugar every year, with a deficit of 200,000 tonnes.

Kenyan government locks out local millers from importing sugar

Kenya's plan to import approximately 900,000 tonnes of white maize by next month has encountered hurdles due to costly global supplies. Recent data from the Ministry of Agriculture and Livestock Development reveals that only about one-third of the desired imports had reached the country by the end of June, just before the duty-free import window is set to close.

Between February and June 2023, Kenya imported a meager 259,470 tonnes of maize, representing 29 percent of the expected imports. As previously anticipated, most imports came from neighboring East African Community countries, particularly Tanzania, rather than from outside the region.

 The Ministry attributed the reduced imports to a tight global market and decreased local demand, resulting from lower purchasing power. Despite the government offering a duty-free import window for maize from outside the East African Community and Comesa, eligible millers and traders reported inadequate global supplies, higher freight and insurance costs, and a dollar shortage, which hindered substantial imports.Additionally, the imported maize arriving at Mombasa is slightly more expensive than local supplies. This situation has raised concerns, especially since, in December last year, the National Treasury allowed the importation of 900,000 tonnes of white maize between February and August to address shortages caused by a decline in local production.The import shortfall is expected to disrupt the government's projected maize balance sheet until September 2023. The plan was to supplement 5.4 million 90-kilogram bags with imports as carryover stocks from June and 19.7 million bags from estimated long rains harvests.

Initially, the Ministry had projected a surplus of 13.3 million 90-kilogram bags of maize after considering a consumption rate of 8.3 million bags between July and the end of September. With an estimated monthly consumption of 2.761 million 90-kilogram bags and a population estimate of 50.6 million, the Ministry aimed to maintain a stable supply for the citizens.

However, the underperformance of the duty-free import window might bring some relief to local farmers. There were concerns that massive imports could flood the domestic market and dilute the prices of their produce. In March, the government urged farmers to release hoarded maize supplies to avoid potential competition from imports.

Despite the duty-free importation of maize, the country's average price of maize grain continues to rise, dashing hopes for cheaper maize flour supplies in the short run. The situation remains challenging, and the government and stakeholders in the agriculture sector will need to work together to find sustainable solutions to meet the country's maize demands."

Only one-third of the desired imports has arrived in the country.

Kenya's duty-free maize import plan flops amidst rising global prices

Sugar is not just for sweetening your coffee. This versatile commodity, produced from sugarcane or sugar beets, is used in everything from skincare to biofuels. The global sugar market is a sweet deal, worth over 

 and attracting traders and investors worldwide.

Brazil takes the cake as the top sugar producer

, churning out around 39 million tonnes - the same as India and Thailand combined. But the price of sugar isn’t always a piece of cake. It’s influenced by factors like currency movements, government subsidies, weather changes, health concerns, and ethanol demand.

Want to trade sugar? Choose your asset, decide how to trade, create a risk management strategy, and open and monitor your trade. You can trade sugar using futures contracts on exchanges like the Intercontinental Exchange (ICE), or through shares of sugar-producing companies or sugar ETFs.

CFD trading is another option that lets you speculate on changing sugar prices without buying or selling the contract. Both CFD and futures trading use leverage, which can magnify potential profits and losses. So don’t forget to add a risk management strategy with stops to your recipe for success.

Top producers, market influencers and trading strategies

Understanding the basics of trading sugar

Xinhua

Sudan is weeks away from a hunger crisis as food stocks deplete because of the continuing conflict that has stopped the flow of cash in and out of the country as well as of key commodities, a group has warned.According to a research by Kulea, a Kenyan commodities platform that leverages technology to provide the tools and the visibility to confidently trade into, out of, and with Africa, Sudan is running completely hand-to-mouth on all major food products.The warning came as violent clashes between the Sudanese Armed Forces and the paramilitary Rapid Support Forces continued on Thursday in the capital Khartoum.The United Nations Food and Agriculture Organization said in its report that the current crisis has worsened the already dire food insecurity in Sudan, with more people possibly plunged into famine.About 2.5 million people had been displaced inside and outside of Sudan since the conflict broke out on April 15, the UN said on Wednesday.

Released on Thursday, the Kulea report said international and regional traders cannot get paid and repatriate funds, making the flow of sugar, rice, and grains impossible.Normally, traders pay for goods at Port Sudan in Sudanese pounds. The cash is then carried physically by car to Khartoum to be converted and sent out as foreign currency.However, during the conflict, cash convoys are not operating, due to the fear that it may be impossible to claim back the funds if a stray missile hit.Additionally, traders in the major cities of Khartoum and Omdurman are avoiding storing any stock out of fear that it would be looted and the fact that the limited warehousing at Port Sudan is full. Traders are currently working to reestablish the banking sector in Port Sudan so that payments can once again start to flow and consequently food and goods.Xinhua contributed to this story.

According to a research by Kulea, Sudan is running completely hand-to-mouth on all major food products.

Hunger stalks Sudan as fighting continues 

The government of Kenya is finally making decent steps toward reviving the country's ailing sugar industry, which has seen millers operate on losses for the past decade. The sector will undergo a crucial turnaround by implementing the 

. In the initial stage of its publication and first parliament reading, the bill received majority support from industry stakeholders and the government. It will go through the third reading for final approval before it assents and gets implemented.The Sugar Bill seeks to restore the powers and roles of the Kenya Sugar Board, which was dissolved and replaced with a directorate under the 

 in 2013. Under AFA, the Sugar Directorate lacks the mandate to directly handle challenges in the sugar industry, subjecting farmers and millers to exploitation. The return of the sugar board will translate to increased industry funding and enhanced powers of the regulatory body. It will institute reforms and set regulations to improve miller and cane grower profits. 

The reinstatement of the Sugar Act, revoked through the enactment of the Crops Act 2013.The re-introduction of the Sugar Development Levy to promote development in the sugar sector.The enhancement of sugar marketing and trade by increasing production.Reduction of the cost of production.Privatization of public sugar mills to improve their efficiency, proper coordination of sugar importation, and ending sugar smuggling and dumping.

Two parliamentary committees are already engaging industry shareholders on approaches to resuscitate five troubled public sugar factories crippled by colossal debt accumulation, poor management, and old factory milling equipment. The committee will present a proposal for parliamentary approval before the third reading of the sugar bill. The report will highlight short-term and long-term measures to institute reforms for the industry's rejuvenation. 

One of the short-term approaches is the payment of cane growers' long-standing dues to dissuade them from shifting to more profitable crops.

 The industry's long-term focus centers on addressing the persistent cane shortage issue that has seen millers halt crushing activities for the better part of Q3 and Q4 of 2023.Last month, the government agreed to adopt commercialization of the factories, placing them under a lease and operating framework. This move ensured the mills remained under government ownership to protect millers and farmers from exploitation by private investors. In addition, 

the president announced plans to write off Ksh 117 billion (approximately USD 799.9 million) in debts accrued by the five sugar factories

. This step will speed up and smoothen the companies' revamp process to bring them back to profitability.

The sector will undergo a crucial turnaround by implementing the sugar bill 2022

The Kenyan government steps up to revive ailing sugar sector

The global commodities market is constantly changing, with prices for commodities like sugar and grains fluctuating based on various factors. As we look ahead to 2023, what can buyers and sellers expect regarding price trends and market outlooks?One of the critical factors that is impacting global commodity prices in 2023 is the ongoing COVID-19 pandemic. WHO reports that as of 30 April 2023, over 765 million confirmed cases and over 6.9 million deaths have been reported globally. However, the cases have reduced from 30% to 17% as vaccination programs are underway in many countries. The pandemic continues to disrupt supply chains and create uncertainty in the market. This has led to higher prices for some commodities, such as sugar and soybeans, and increased demand for others, such as wheat and corn.Another factor that could impact commodity prices is the ongoing conflict between Russia and Ukraine. With the recent attack on the Kremlin, analysts predict the global supply chain will mostly be affected in 2023. The conflict can potentially disrupt key supply chains and impact the production and transportation of commodities like wheat and corn. In addition, economic sanctions and political instability in the region could also lead to higher prices for some commodities.

Inflation will also likely be a significant factor in global commodity prices in 2023. The US Federal Reserve and other central banks have implemented accommodative monetary policies to stimulate economic growth, which has led to higher inflation in many countries. This could lead to higher prices for commodities like sugar and edible oils, often used to produce other goods. In East Africa, for example, Business Daily reports that Kenya is the only country with an upward economy at the rate of 5.3%, as forecasted in 2022. Burundi’s projected growth for 2023 has suffered the largest slash of 80 basis points to 3.3 percent, followed by Rwanda’s, whose projected growth has been downgraded by 50 basis points to 6.2 percent. Src; BDClimate change is another critical factor impacting global commodity prices in 2023. Extreme weather events, such as droughts and floods, can impact crop yields and lead to price volatility in the market. Floods, for example, have wrecked parts of southern Africa, making sugarcane transportation impossible. In addition, efforts to mitigate the impact of climate change, such as the transition to renewable energy, could impact demand for commodities like oil and gas.Despite these challenges, some positive trends could impact global commodity prices in 2023. For example, growing demand for plant-based foods and alternative proteins could increase demand for commodities like soybeans and pea protein. In addition, technological advances in agriculture, such as precision farming and vertical farming, could improve efficiency and increase yields for certain crops.Overall, predicting global commodity price trends and outlooks is a complex undertaking. However, buyers and sellers can maximize their chances of success in the commodities market by staying informed about market trends and being prepared to adapt to changing conditions.

An analysis of the market forecast

Global commodity price trends and outlooks for 2023

Technology has transformed nearly every industry in recent years, and the commodities market is no exception. With the advent of platforms like Kulea, buyers and sellers in the commodities market can now access valuable insights, expert analysis, and real-time vessel tracking that enable them to make informed decisions and transact with confidence.

One of the key benefits of technology in the commodities market is improved efficiency. Real-time vessel tracking, for example, allows buyers and sellers to track the location and movement of commodities as they are shipped from one location to another. This enables them to manage their supply chain better and make more informed decisions about when to buy and sell commodities.

Another benefit of technology is increased transparency. With Kulea's platform, buyers and sellers can access information on global commodity prices, market trends, and other data that was previously difficult to obtain. This level of transparency helps reduce information asymmetry in the market, making it easier for buyers and sellers to reach mutually beneficial agreements.

Overall, the impact of technology on the commodities market has been overwhelmingly positive. As technology advances, we can expect to see even more innovation and disruption in the commodities market, and platforms like Kulea will continue to play a vital role in driving this transformation.

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