NAIROBI, Kenya — Retail sugar prices in Kenya have recorded their sharpest monthly decline in nearly two years following the government’s decision to end long-standing import safeguards under the regional trading bloc, the Common Market for Eastern and Southern Africa (COMESA).
Latest data from the Kenya National Bureau of Statistics (KNBS) show the average price of sugar dropped by 4.37pc to Sh166.56 per kilogramme in February, down from Sh174.17 in January, marking the steepest month-on-month decline since April 2024.
The drop extends a series of price declines that began late last year, pushing retail sugar prices to their lowest levels in nearly 11 months.
Market opening after 24 years of protection
The price reduction comes shortly after Kenya exited the COMESA sugar safeguard regime in January, ending more than two decades of protection for domestic sugar producers from cheaper imports across the region.
Kenya had relied on these safeguards since 2001, when the government secured special permission to restrict sugar imports from COMESA countries in order to shield its high-cost domestic industry from competition. The arrangement was extended eight times over the years.
Under the safeguards, the country was allowed to import up to 350,000 tonnes of sugar annually from COMESA markets to fill local supply gaps while still protecting domestic producers.
Analysts say the removal of the protection has now opened the market to cheaper regional sugar supplies, increasing competition and pushing down retail prices.
Struggling domestic sugar sector
For years, Kenya’s sugar industry has struggled with high production costs, ageing factory equipment, debt-burdened mills, and inconsistent sugarcane supplies.
Many State-owned mills — particularly those in western Kenya — have faced operational challenges that made locally produced sugar significantly more expensive compared to imports from neighbouring COMESA countries.
The government has attempted to revive the sector through reforms, including restructuring public mills, writing off debts, and improving cane production systems to enhance competitiveness in the long term.
Relief for consumers, pressure for millers
Economists say the current price drop could offer short-term relief to households grappling with the high cost of living, especially as sugar remains a staple commodity in many Kenyan households.
However, industry stakeholders warn that cheaper imports may intensify pressure on local factories and farmers if the domestic sector fails to modernise and reduce production costs.
With the market now fully open to regional competition, experts say the sustainability of Kenya’s sugar industry will depend on structural reforms, increased productivity, and improved supply chain efficiency.
Wider economic implications
The policy shift reflects a broader effort by the government to align with regional trade commitments while encouraging efficiency in domestic industries.
At the same time, the end of the safeguard regime marks a critical turning point for the sugar sector, forcing local producers to compete directly with regional suppliers after more than two decades of protection.
Whether the new market dynamics lead to long-term stability or deeper challenges for Kenya’s sugar industry will largely depend on how quickly local mills adapt to the new competitive landscape.
