Should Kenyans expect the cost of life/food prices to go down soon? It might be discouraging, but it can’t be done immediately, in a heartbeat. It might not happen at the end of September 2022, right after the Supreme Court rules on the general election petition and a new government takes over.
The rise in food prices and the cost of living in Kenya can be ascribed to domestic and external factors.
One of the most significant factors that triggered the increase in food prices in Kenya is the Covid-19 pandemic which caused disruptions in world production and trade. Since it hit the world, the production and distribution of products have been affected by the imposed preventative health measures like curfews and lockdowns. The demand for goods could no longer keep pace with the supply, which created shortages in the market – triggering price increases.
The disruptions also increased the charges of imports to the country, which relies heavily on imported foodstuff. Cereal commodities like rice and wheat form some of the most significant foodstuff imports in value and volume.
The Side Effects of Russian-Ukrainian Conflict
The Russia-Ukraine conflict is another external factor triggering food price increases in Kenya. Kenya imports about 32% of wheat (the 3rd most consumed commodity in Kenya) from Russia, making it the leading supplier to the country. Kenya also sources a significant percentage of its fertilizer, edible crude oil, and fuel from Russia.
According to the recent data by KNBS (Kenya National Bureau of Statistics), Kenya's imports from Russia declined from 19.9B to 6.6B (a drop of 66%) in March when Russian troops entered Ukraine. This has created a shortage of wheat, fertilizer, and fuel supply, causing price increases.
“We rely on Russia and China to supply us with fertilizer and the ongoing conflict in Russia has caused the prices of fertilizer to shoot from $25 to $70 per 50 kg bag," Peter Munya said.
Exports to Russia have been affected as well. Russia is the 5th global consumer of Kenyan tea, having ordered up to 6.2B in the last 11 months to 2022. According to TBK (Tea Board of Kenya), the export income from Russia was reduced by Ksh 598 million as the volume declined from 2.6 million kilos to 686,072 kilos (74% decline).
Ukraine, on the other hand, accounts for about 94% of soya supplies to Kenya. It also supplies the country with 3% maize and 2% wheat. These imports are not getting to Kenya quickly due to the war disruption.
“Kenya is encountering logistic issues due to shipping problems. Wheat is not getting out of Ukraine and the security near the conflict zone is making it hard even for us to deliver our products," said Julius Opiyo, KNCCI Chairman, Nairobi.
Other than the international factors, domestic factors account for high food prices and the cost of living in Kenya. For example, the government of Kenya raised the excise duty on commonly used home products from 1st November 2021. This came into effect after the country signed a deal to acquire loans from the IMF as part of the Covid-19 pandemic relief.
Additionally, food production in Kenya has been affected by adverse weather conditions. Poor weather forecasting has left Kenyan farmers counting huge losses when rain fails.
Failure on the part of the government to subsidize fertilizer and fuel has also had an adverse effect on the struggling Kenyan population.
Another significant factor contributing to high food prices in Kenya is corruption. As per the 2021 Corruption Perception Index, Kenya is at position 128th, which means the country has a long way to go. Most funds for development programs that would boost the country’s economy are stolen, and no severe measures are taken against the thief.
“Every single day, my government loses over 2 Billion public funds meant for development projects in the country…!”
The political landscape in Kenya is yet another thing to blame for the country's high cost of living and food prices. Kenyans vote along the tribal line, and the country has had political violence in the past (2007). Also, chaotic demonstrations are common after every general election. So whenever the electioneering period comes, people leave their workplace – not because they are going to their background to vote, but because they fear another instance of violation.
The market structure is the last thing to blame for higher food prices in Kenya. The lack of healthy competition in specific sectors creates room for "cartels" to raise prices as they want.
Kenyans aren't happy. And indeed, they should not be. Affording a well-balanced diet is now a matter of luck for the vast majority. The situation is because the increase in food prices didn’t reflect an increase in wages, salaries, or incomes.
Frankly, most Kenyans are now skipping meals. The typical breakfast of tea and bread has been forgotten in many homes. And even where they still afford it, the quality and quantity are slightly lower than they used to be.
The secretary general of CFK (Consumer Federation of Kenya), Stephen Mutoro, now claims that about 40% of Kenya's households go without breakfast.
“Breakfast is no longer affordable in most families – it became a luxury a long time ago," he said.
Speaking to the Nation, Mary Anyango Omondi, a teacher in an unidentified school in Kisumu County, said she's struggling to feed her family of four with her meager salary. She currently buys two liters of packet milk and two loaves of bread which costs her approximately 500 KES.
“Considering these costs, we now prefer to drink black tea and eat sweet potatoes in the morning when we can’t afford milk and bread. Life is very challenging," she said.