15 April 2018

Kenya: Sugar Prices Fall as Millers Compete With Cheap Imports

Consumer prices of sugar have fallen further following competition between local and imported products.

In most Nairobi retail shops, a two-kilogramme packet has dropped from a high of Sh230 in January and February to retail at Sh205 for Kabras sugar and Sh175 for Neutral Meal. Other brands are conspicuously missing on the shelves.

According to the Sugar Directorate, the downward trend has been occasioned by the declining cost of the commodity in factories.

"The prices have dropped in the factory because of competition between the imported sugar and the one produced locally.

"This has in turn had an impact in the cost of consumer prices," said an official at the directorate.

A tonne of imported sugar is on average retailing at Sh3,000 per tonne while the local one is selling at Sh3,600.

This has made it difficult for millers to compete with the cheap imported commodity, leaving them with huge stocks that threaten to paralyse their activities.

As of last week, millers were holding over 22,000 tonnes as distributors who normally buy from them are opting to procure from traders at a cheaper cost.

Consumer prices had hit a high of Sh400 last year, forcing the government to intervene by scrapping duty on imports from outside the Common Market for Eastern and Southern Africa (Comesa), which saw traders import over 900,000 tonnes.

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