Sugar prices have reached a new high with the two-kilogramme packet now retailing at Sh330, which together with expensive milk is set to make breakfast costly especially for low-income people.
This comes amid a severe shortage of sugar on the shelves with nearly all supermarkets only stocking the Kabras brand. The commodity has been retailing at an average of Sh290 per two-kilogram packet since January.
The increased cost will complicate matters for the households who are grappling with high cost of living following a sharp increase in prices of basic commodities that pushed inflation to 11.48 per cent.
Prices of milk have increased significantly in the recent months with the long-life brand selling at over Sh70 while the fresh one is retailing at Sh65 for a half litre packet. The prices are even higher outside the major supermarkets.
The Sugar directorate says the shortage results from a severe drought that affected production of cane in major growing zones.
“The current situation results from a shortage of cane that we have at the moment following the drought that affected production,” says the head of Sugar Directorate Solomon Odera.
He said the directorate projects a shortage of 1.9 million tonnes of cane by the end of this financial year.
Price of sugar in Kenya has been on an upward trajectory since last year with the increase blamed on cane scarcity and poor performance by the State-owned millers. Sugar sector report for February indicates that production declined from 126,362 tonnes registered last year to 104,907 tonnes in the period under review.
Meanwhile the directorate says price of sugar escalated by 17 per cent in February compared with the same period last year, pushing it to the highest point in the last five years. A status report from the Sugar Directorate indicates the wholesale price in February 2017 stood at an average of Sh5,352 per 50kg bag compared with Sh4,432 in the same period last year.
The commodity has been retailing at an average of Sh290 per two kilogramme packet, the highest since 2012 as the scarcity of the commodity pushes up the cost. “In February 2017 wholesale sugar prices were in the range of Sh4,950 to Sh5,700, with a mean price of Sh5,352 per 50kg bag compared with a mean price of Sh4,432 per 50kg bag during similar period in 2016,” says the report.
Credit: CNBC Africa