Kenya's Sugar Prices to Increase over Reduced Local Production, Report
- In November 2024, President William Ruto assented to the Sugar Act of 2024, which introduced a 4% sugar development levy
- The Tax Laws (Amendment) Act of 2024 also increased excise duty on imported sugar from KSh 5 to KSh 7.5
- A new report warned of an impending increase in sugar prices in the country for the manufacturing year 2025/26
- A spot check across supermarkets in the country showed that a 2kg packet of sugar currently retails for around KSh 315
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Wycliffe Musalia has over six years of experience in financial, business, technology, climate, and health reporting, providing deep insights into Kenyan and global economic trends. He currently works as a business editor at TUKO.co.ke.
Kenyans will soon dig deeper into their pockets to buy sugar across the country.
Source: Twitter
A new report, dubbed Sugar Annual, by the United States Department of Agriculture, warns of an impending increase in sugar prices.
The report dated April 18, 2025, anticipates an increase in retail prices at the start of the manufacturing year (MY) 2025/26, citing tight supply due to the closure of local mills for annual maintenance.
"The prices will however stabilise once imports kick-in. According to industry sources, sugar is currently retailing at around KSh 165 ($1.28) per kilo," reads the report in part.
What's the current price of sugar?
TUKO.co.ke conducted a spot check across supermarkets in the country, which showed a 2kg packet of sugar currently retails at between KSh 315 and KSh 350.
A kilo of sugar sells at around KSh 150 and KSh 165 across supermarkets and shops.
The rise in sugar prices is attributed to a 19.8% decrease in production for the year under review to 650,000 metric tons, down from 810,000 metric tons reported in the manufacturing year 2024/25.
These will be exacerbated by a decrease in harvested area and lower sugar extraction rates arising from premature cane harvests.
"In MY 2024/25 the average cane yield decreased substantially to 51 MT/ha from 56MT/ha in the previous year, due to dry weather conditions that preceded harvesting in some of the cane growing regions," the report continues.
What other factors will lead to increased sugar prices?
The report also cites an increase in sugar consumption estimated at 1.6% to 1.25 million during the same period.
Sugar imports are also expected to surge by 38% to bridge gaps in the local supply deficit.
President William Ruto's administration increased excise duty on imported sugar, a move that will raise prices if imports are more than local production.
Source: UGC
Which taxes will increase sugar prices?
The Tax Laws (Amendment) Act 2024, which came into effect on December 27, increased excise duty on imported sugar from KSh 5 to KSh 7.5.
Kenya Revenue Authority (KRA) instituted the changes after President Ruto signed the law.
In November 2024, the head of state assented to the Sugar Act 2024, which introduced a 4% sugar development levy.
The sugar development levy is imposed on both locally manufactured and imported sugar.
Proofreading by Mercy Nyambura, copy editor at TUKO.co.ke.
Source: TUKO.co.ke
