> I did not know that I had to install CyrusSASL which is most likely my issue.

Actually not entirely - you have it installed but it fails identifying any 
mechanisms. CyrusSASL authentication mechanisms work based on plugins. So what 
you possibly miss here is just the additional plugin/s - as Vinod pointed out, 
the one you need to get installed is the CRAM MD5 mechanism plugin. Another 
hint here is, try to avoid building CyrusSASL yourself but prefer using 
prebuilt packages instead - I have seen weird bugs popping up when mixing in 
manually built CyrusSASL with prebuilt (plugin) packages.
 

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