Nairobi — Low rainfall, high cost of fertilizer and seeds, and high fuel prices hindered production in the agricultural sector in July, a new survey has shown.
According to the Agriculture Sector survey prepared by the Central Bank of Kenya (CBK), the prices of most food items are expected to increase due to low production amid high demand.
The survey being the first one ever carried out by the Monetary Policy Committee (MPC intended to bring to light the changing trends in the sector as far as the prices of agricultural commodities are concerned, the challenges the sector faces and implementations needed to solve the difficulties it faces.
"The price of wheat is expected to go up in August due to reduced production following the reduced acreage as farmers grapple with the dry weather conditions," read the survey report.
The respondents indicated that the cost of transport, weather conditions, and cost of farm inputs such as fertilizer and seeds are also some of the challenges that face the sector in addition to the Ukraine-Russia war that hindered the importation of wheat in the country to supplement what farmers grow locally.
Respondents noted that lowering fuel prices, providing concessionary loans to market traders, building more dams for irrigation as well as reducing the cost of fertilizer and seed will help improve the sector.
In the retail market, the survey noted that the cost of kales and cabbages went up as the traders transferred the high cost of production to consumers, which was attributed to the drop in demand for the commodities as well as the persistent drought.
On the upside, the prices of cabbages, tomatoes, onions, potatoes, and maize dropped.
The drop in the farm price of dry maize was attributed to the interventions made by the government to waiver import duties on maize import in the country thus increasing its supply.
"With the harvest season for maize and wheat in the country being around the corner, their prices are also expected to go down further," the survey noted.
Respondents also expect the supply of green maize and wheat to increase from August with the harvest season while the supply of dry maize is expected to increase due to imports.