Commodities

Sugar price increases by Sh30 a kilo on factory interruptions

sugar-carre

A sugar section at a supermarket. FILE PHOTO | NMG

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Summary

  • A two-kilogramme packet of the sweetener, which retailed at Sh200 as late as August, has hit Sh230 in retail shops—a level last witnessed in January last year.
  • The cost is even higher in estate shops where a kilo of loose sugar is selling at Sh240 for a two-kilo packet from Sh200 previously.
  • Chemelil and Kibos sugar mills broke down, leading to a huge backlog of cane to be processed in which has impacted on total stocks in the country.

Consumer prices of sugar have risen by up to 30 percent as several factories grappled with production hitches due to the breakdown of machines and shutdowns for routine maintenance.

A two-kilogramme packet of the sweetener, which retailed at Sh200 as late as August, has hit Sh230 in retail shops—a level last witnessed in January last year.

The cost is even higher in estate shops where a kilo of loose sugar is selling at Sh240 for a two-kilo packet from Sh200 previously.

Chemelil and Kibos sugar mills broke down, leading to a huge backlog of cane to be processed in which has impacted on total stocks in the country.

“Most factories were in maintenance impacting on production,” said Agriculture Principal Secretary Hamadi Boga.

Closure of the factories left farmers stranded with over 14,000 tonnes of the crop drying on the farms and trucks as long queues of tractors were witnessed at different weighbridges.

The shortage has seen wholesalers increase the cost of a 50- kilogramme bag from Sh4,500 previously to Sh4,800 attributing the rise to a tight supply in the market.

“We have had to adjust our cost in line with the increase in the market,” said James Ng’ang’a a trader in Nairobi.

The rise in prices comes at a time when the country has limited cheap imports from Common Market for Eastern and Southern Africa (Comesa) to protect growers from the competition.

The Ministry of Agriculture in the new quota rules for each country will see millers allowed to import only 210,163 tonnes of the commodity this year from the usual 350,000 tonnes that the country is normally allocated under the Comesa window.