Shoppers at Naivas Supermarket, Nyali Bazaar Mall in Mombasa on August 29, 2024.
Consumers are staring at elevated food prices as they head into the Christmas festivities on a myriad of seasonal factors as well as global price rises, traders have warned.
In a new survey conducted by the Central Bank of Kenya (CBK), wholesalers and retailers in the food market supply chain foresee a jump in the prices of tomatoes, beans, green grams, green maize, and maize grain on account of seasonality effects.
“Most respondents expect an increase in tomato prices as market supply is likely to be impacted by the October-December 2024 rain season. The expected increase in tomato prices is largely driven by seasonal factors as tomato supply tends to decline during the rainy season and increase when dry conditions set in,” wrote CBK in its latest Agriculture Sector Survey.
“Respondents also expect an increase in prices of beans, green grams, green maize, maize grain – loose and garden peas in December 2024, largely reflecting seasonality.”
The survey also shows that traders anticipate the prices of sugar, cooking fat, and cooking oil to rise during the season, reflecting developments in the global market where prices of these items have been rising in the recent past.
The CBK report, however, shows that prices of most varieties of rice are expected to remain stable albeit with a slight downward bias, riding on the back of improved domestic production with support from imports. Milk prices are also expected to remain stable on account of favourable weather conditions that have improved pasture complimented with imports, especially from Uganda.
According to the survey, 86 per cent of traders cited transport costs as a key factor influencing retail prices, with 62 per cent citing the impact of weather conditions such as floods and drought while 63 per cent alluded to supply chain disruptions.
The impact of ‘distance to market’ was least cited as farmers reported to be travelling shorter distances in search of supplies due to bumper harvests for most crops across the country.
On the general consumer price level in the economy (inflation), CBK reports that 52 per cent of survey respondents expect overall inflation to remain unchanged or to decline in the next three months, compared to 48 per cent who anticipate an increase.
Similar surveys earlier in the year had shown a slightly higher proportion of respondents who expected overall inflation to either remain unchanged or decrease three months ahead, against those that expected an increase.
According to CBK, this expectation has been driven mainly by the noted increase in food supply due to conducive weather, a stable exchange rate, and relatively lower fuel prices.
