Commodities

Relief for consumers as sugar price falls Sh6 a kilo in September

sugar

A man picks sugar at a supermarket in Nairobi. FILE PHOTO | NMG

Retail sugar prices fell Sh6 a kilo last month compared with August informed by rising supply, marking the first drop since the crackdown on illegal products started in May.

Households paid an average of Sh146 per kilo for sugar in September, data from Agriculture and Food Authority indicate, compared with Sh152 a month earlier.

Excluding August, the cost of sugar in September was still the highest since June 2017 when the commodity sold for Sh149 a kilo ahead of the government’s tax-free window for imports.

“The downward trend (in sugar production) reversed from a low of 28,320MT (metric tonnes) in June 2018 to close the period under review (September 2018) with an improved sugar production of 36,502 MT,” AFA says in the September report.

“However most sugar factories are grappling with limited supply of sugar cane which has led to the mills operating below 50 percent of their installed crushing capacity.”

The Treasury scrapped import duty on the commodity last year following a sharp decline in production due to drought, which saw average retail price per kilo jump to as much as Sh179 in May 2017. The blanket import duty waiver from July last year resulted in a market glut, pushing down consumer prices to as low as Sh75 per kilo earlier in the year.

A crackdown on counterfeit and substandard foreign-made sugar by State agencies such as the Kenya Bureau of Standards which started in May, however, resulted in prices rising to as much as Sh200 per kilo, a steady rise in retail prices, peaking in August at an average of Sh152 per kilo.