Cost of Christmas: Highs and lows of food prices this festive season

Sugar and cooking oil are some of the food items which will be pricey this holiday season, despite the drop in inflation rate to 2.8 per cent. The Agriculture Sector Survey for November 2024 published by the Central Bank of Kenya also lists tomatoes in this basket of food items, citing the October-December rains as a cause. The survey notes that prices of some food items shot up in the month, projecting the extra cost households will carry during the festive season. These items include maize flour, wheat flour, sugar, sukuma wiki and spinach. During the same period, the prices of green maize, loose green maize, some types of rice, green grams, beans, milk, cabbages and onions dropped. The increase in prices for the mentioned food items has been linked to macro-economic factors and the October-December rains for some. "Prices of sugar, cooking fat, and cooking oil (salad) are expected to slightly increase in December 2024. This is consistent with developments in the international market where prices of these items have been increasing in recent months," the survey reads. The survey states that the balance of opinion on expected price changes in December, shows that the number of items whose prices are expected to increase is almost the same as those with a downward price expectation. Balance of opinion, or BOO, is the metric used to show the net position of responses given to selected questions. It is the difference between the proportion of respondents who had a negative opinion divided by the total number of respondents. The respondents were drawn from the wholesale and retail markets and select farms from the country's food basket regions. These include Nairobi Metropolitan Area, Nakuru, Gilgil, Mombasa, Eldoret, Kitale, Nyandarua, and Bomet. There were 233 respondents, with farmers accounting for 52 per cent. The survey says the BOO points to an expected general decline in prices of several key food items in December while postulating increases in a few in line with seasonal factors. "For instance, most respondents expect an increase in tomato prices as market supply is likely to be impacted by the October-December 2024 rains season," the survey says. "The expected increase in tomato prices is largely driven by seasonal factors as tomato supply tends to decline during rainy season and increase when dry conditions set in. It adds: "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 details that prices of most varieties of rice are expected to remain stable albeit with a slight downward bias. It says rice is among food items whose prices have generally been stable for over two years, supported by domestic production and imports. Milk prices have also been relatively stable in the last year supported by favourable weather conditions that have improved pasture complimented with imports especially from Uganda. "Most respondents in the November 2024 survey expected the price of the two commodities to remain stable," the survey reads in part. Drop in food prices due to favourable weather conditions has been key in bringing down the inflation rate to a manageable range of 5.0 per cent +/- 2.5 per cent. Latest figures from the Kenya National Bureau of Statistics (KNBS) has the November inflation rate at 2.8 per cent. Drop in the prices of cabbages, onions, potatoes, carrots and fresh cow milk are associated with the decrease. During the same period, prices of sugar, sifted maize flour, fortified maize flour, cooking oil, tomatoes, loose maize flour and loose maize grain went up which explains the slight increase of inflation from 2.7 per cent in October to 2.8 per cent. The survey in discussion shows that most respondents (52 per cent) expect overall inflation to either remain unchanged or decline in the next three months, compared to 48 per cent who expect an increase.

Cost of Christmas: Highs and lows of food prices this festive season

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Cost of Christmas: Highs and lows of food prices this festive season

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