Rice consumption by Kenyans on the rise despite declining production

By Soko Directory Team / Published October 3, 2017 | 7:31 am

Rice consumption in Kenya continues to increase rapidly due changing dietary preferences, higher incomes, and urbanization.

Kenya’s rice consumption has been growing at the rate of 10 percent a year to stand at 400,000 tonnes, according to the Ministry of Agriculture.

There has been a steep decline in rice production in Kenya which in turn has led to an increase in the retail prices of 38 percent, piling pressure on households that are already grappling with the high cost of living in a sluggish economy.

In 2016/2017, Mwea irrigation scheme in Central Kenya that produces over 80 percent of Kenya’s rice had over fifty percent decrease in production due to the impact of drought on water levels in the supplying rivers, Nyamindi and Thiba.

Currently, a kilogram of Pishori rice at Mwea Irrigation Scheme is retailing at more than 200 shillings per kilogram, up from 145 shillings in January.

The cost of rice has been increasing since January following a drop in output at the Mwea Irrigation Scheme in the wake of a severe drought that affected the flow of water.

Kenya produces 150,000 tonnes of rice a year, leaving a 250,000 tonnes deficit that is met through imports.

Local production has not been able to meet demand and the resultant deficit is offset by imports by private traders, mainly from Pakistan, Thailand, India, and Vietnam.

Kenyan consumers prefer the aromatic rice varieties and retail prices invariably reflect this preference.

Retail prices for Basmati rice at the mills typically ranged between 110 shillings per kilogram in January to 125 shillings per kilogram in December and mirrors the rice production/supply cycle. In MY 2016/2017 the cycle was however breached due to the tight supply situation brought about by lower than normal production.

In February 2017, two months into the calendar year, the retail price at the mills was already 150 shillings per kilogram underscoring the adverse impact of the prevalent drought not only to producers but to consumers.

The National Irrigation Board (NIB) said rice production at Mwea dropped from average yields of 830,000 bags in the season ended March last year to 498,000 bags in the season ended March this year, a 40 percent decline.

This has seen the value of rice imports increase to 15.89 billion shillings in the six months to June, up from Sh6.6 billion in the same period last year. The volume of imported rice rose to 353,082 tonnes from 261,819 tonnes in the same period last year.

A kilogram of Daawat Basmati rice was Monday selling at 237 shillings, Daawat Aromati 217 shillings, Sunrice Mwea Pishori 200 shillings and Pearl Kenya Pishori 249 shillings.

The drought, which took a toll on production early this year, has affected hundreds of growers who rely on the crop as their economic mainstay. With good rains, farmers in Mwea produce rice worth 7 billion shillings a year.

The acute shortage of rice comes at a time when research findings by Egerton University-based Tegemeo Research Institute indicate that rice is becoming an important staple due to changing lifestyles and growth of the middle-income population.

The national rice development strategy had last year projected that by 2017 the demand for rice would surpass the current estimates of 400,000 tonnes.

About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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