Retailers Taking advantage of Sugar Shortage to Set High Consumer Prices

By Vera Shawiza / January 11, 2017


The average factory price for a 50-kilogram bag of sugar is currently retailing at 5,400 shillings, down from 5,600 shillings. Even with this decline on the prices, households are still buying the commodity at 135 shillings from the supermarkets for the local sugar.

Factories have lowered the price for sugar by almost 4 percent, and as usual, it is expected that retailers also need to follow suit and lower it for consumers. With the same prices, still on for retailers, they are taking in very high profits as they end up making a total of 6,750 for the same 50-kilogram bag which they get at 5,400 shillings, an additional 1,350 shillings for them.

The Agricultural Authority of Kenya has however issued a directive for retailers not to increase the prices anymore due to increased sugar imports in the country meant to cater for the lower production locally therefore leading to a shortage on the sweetener. The imports have been maintained at over 20,000 tonnes a month, up from 15,000 tonnes that should be imported when the sugar situation in the country normalizes.

With most of the public sugar millers crushing at barely half their capacities, local stocks of sugar have been declining in the last couple of months, forcing the Sugar Directorate to increase imports by 67 percent to cover the fall in domestic production.

From November last year, the country has been facing acute sugar shortage therefore leading at an importation of 25,000 tonnes  nd an additional 23,000 tonnes in December to supplement shrinking local stocks. Stocks held by millers in factories dropped to a low of 6,500 tonnes as of Tuesday, 2017, from 8,000 tonnes late last month as some processors struggle with production issues due to low-cane supply.

Kenya produces 630,000 tonnes of sugar a year, compared with an annual consumption of 900,000 tonnes. The deficit is met with imports from the Common Market for Eastern and Southern Africa (Comesa) and East African Community member states. The imports are currently being trucked from Uganda or shipped in from Madagascar, Malawi and Zambia.

Related: Increased Maize Prices Affecting Kenyan Households



About Vera Shawiza

Vera Shawiza is Soko Directory’s in-house journalist. Her zealous nature ensures that sufficient and relevant content is generated for the Soko Directory website and sourcing information from clients is easy as smooth sailing. Vera can be reached at: (020) 528 0222 or Email: [email protected]

View other posts by Vera Shawiza



Other Related Articles








SOKO DIRECTORY & FINANCIAL GUIDE

ARCHIVES

2018
  • January 2018 (291)
  • February 2018 (221)
  • March 2018 (279)
  • April 2018 (198)
  • 2017
  • January 2017 (183)
  • February 2017 (195)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (206)
  • July 2017 (190)
  • August 2017 (196)
  • September 2017 (186)
  • October 2017 (236)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (167)
  • February 2016 (165)
  • March 2016 (190)
  • April 2016 (143)
  • May 2016 (246)
  • June 2016 (183)
  • July 2016 (271)
  • August 2016 (250)
  • September 2016 (234)
  • October 2016 (191)
  • November 2016 (244)
  • December 2016 (154)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (166)
  • April 2015 (109)
  • May 2015 (117)
  • June 2015 (121)
  • July 2015 (150)
  • August 2015 (157)
  • September 2015 (189)
  • October 2015 (171)
  • November 2015 (174)
  • December 2015 (208)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950