Sugar Prices To Hit Record High
It is anticipated that sugar prices in the nation will reach an all-time high as a result of decreased harvests in India and Thailand, which were devastated by heavy rainfall.
India, a significant provider of sugar to Kenya, has initiated export restrictions that have affected more than a thousand well-known local importers.
The adverse weather conditions associated with El Niño have prompted India to reduce its exports, as they have caused damage to crops and consequently produced substandard harvests.
The repercussions are presently being experienced on global markets, initiating an era of unparalleled pressure on the sugar sector.
Already, the Food and Agriculture Organisation of the United Nations (FAO) has issued a warning that global sugar production will decline by 2%, or 3.5 million metric tonnes, during the 2023-24 season.
FAO estimates that developing nations, such as Kenya, will be disproportionately affected by the 3.5 million metric tonnes deficit, since developed nations can sustain the higher costs rather than pass them on to consumers.
As a result of reduced sugar shipments from India, Kenya has been relying on Uganda, a neighboring country, to make up for the shortfall.
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As a consequence, Kenyans have purchased the commodity from Uganda at exorbitant prices.
Following India’s May decision to restrict sugar exports to safeguard the domestic economy, Kenya imported 68% of its sugar from Uganda.
As per the Sugar Directorate, as a consequence of this, Uganda surpassed India in its status as the leading exporter of the commodity to Kenya.
India regained its position as the leading sugar exporter to Kenya in July, with 624 suppliers from the Asian nation delivering 24 metric tonnes of sugar to the country.
In light of the unfavourable harvest in India, Kenya will once more import sugar from Uganda, where the price, as estimated by the Sugar Directorate, is 43 percent higher than that purchased from India.
At the moment, a 2-kilogram packet of sugar is available for purchase in Kenyan supermarkets for an average of Ksh420.
Sugar Prices To Hit Record High
