Sugar price drops Sh18 per kilo on rising production

The retail price of sugar has dropped by up to Sh18 per kilogramme in the past two months as consumers start to reap the benefit of an increase in local production.

A spot check by the Business Daily shows that a two-kilo packet of the commodity is now retailing at Sh189 for Kabras sugar, Sh206 for Ndhiwa and Sh210 for locally packaged product, from a high of Sh225 in January.

The price fall ironically comes at a time when the government has tightened import measures by restricting the amount that can be shipped into the country, to curb flooding of cheap sugar that had initially been blamed by processors for depressed prices.

The current prices are attributed to an increase in production locally with the volumes of sugar cane coming from farms having increased.

“The Sugar Industry has witnessed a steady increase in sugar production due to enhanced investments by both government and private players. In 2020, a total of 603,788 tonnes of sugar was produced compared to 440,935 metric tonnes in 2019. This signifies an improvement of 37 percent in local production,” said the Ministry of Agriculture.

The sugar cane availability survey conducted by Agriculture and Food Authority (AFA) in December 2020 established that there will be enough cane to produce at least 660,000 tonnes of sugar this year.

The first two months of 2021 have recorded production of 119,552 tonnes of sugar indicating the projection is likely to be achieved.

The total cane deliveries in the period January to December 2020 was 6.8 million tonnes against 4.6 million tonnes recorded during the same period in 2019, an increase of 48 percent.

Partly as a result of the higher local production, the National Treasury last month lowered the cap of the amount of sugar that can be imported duty free to Kenya from the Common Market for Eastern and Southern Africa (Comesa) to 210,163 tonnes from 300,000 tonnes, with imports exceeding the cap subjected to 100 percent duty.