Tanzania is partly to blame for the unprecedented spike in onion prices, according to the Central Bank of Kenya's latest Monetary Policy Committee Meeting.
According to CBK's minutes released on Tuesday, August 15, onions, both bulbs and leeks, recorded the highest year-on-year price increase, with the highest being a 22.2 per cent rise as of July 2023.
Citing the Agriculture Sector Survey through which farmers are assessed to predict the prices of commodities, CBK noted that reduced imports from Tanzania marked the main challenge regarding the supply of onions.
As a result, the President Samia Suluhu-led government increased the price of Tanzania onions which are drier, have a longer shelf life and are a favourite among Kenyan consumers.
The situation is expected to worsen by the end of August, with the vital household vegetable recording a 40 per cent increase in price alongside other basic food commodities such as eggs (60 per cent) and sugar (55 per cent).
Other products expected to record a surge in price are cooking oil (40 per cent) as well as cooking fat (40 per cent).
"Onion prices expected to rise with reduced supplies locally and imports from Tanzania," read the findings in part.
The depressed harvest was also attributed to poor harvest within the country after farmers experienced rainfall challenges.
Francis Njuguna, an onion farmer from Githunguri, told Kenyans.co.ke that the cost of production rose to Ksh40 per kilogramme of onions as farmers passed on other costs of production to consumers.
Among them was the cost of irrigation, which was said to total an average of Ksh5,000 per day and an increase in electricity cost (over 60 per cent between July 2022 and 2023).
According to Njuguna, however, the farmers realised profits largely because of the increase in price occasioned by the scarcity of crucial products.
With all factors considered, consumers were said to be buying a kilogramme of onions at Ksh150. A standard-sized red bulb onion, which averaged Ksh7 per piece, tripled to Ksh20.
"There was reduced harvest this season because of the reduced rain and I had to spent a lot of money on irrigation. On average, an acre produces 14 tonnes but I only harvested 9 tonnes," he stated.
"I made a profit because the scarcity contributed a lot to the pricing. Even the inputs were very high. I harvested 21,000 kilogrammes and sold Ksh75 per kg. My cost per kg was Ksh40," Njuguna added.
