Cooking oil prices surge on intensified war between Russia, Ukraine

Cooking oil prices surge on intensified war between Russia, Ukraine

Manufacturers of cooking oil are now substituting the commodity with palm oil after Ukraine cut short its global supply due to its continued war with Russia.

This has caused an uptick in cooking oil prices which is currently retailing between Ksh.200,534 and Ksh.225,522 per tonne.

Before the conflict, the commodity was selling for Ksh.168,578 per tonne.

A 500 grams of cooking fat costs Ksh.149.44 from Ksh.142.05 while the cost of one litre salad cooking oil has soared by 2.1 percent to Ksh.305.70.

“Locally, Covid-related factors had already caused a jump in the price of a 20- litre Jerry Can from Ksh.2,200 to Ksh.4,500 in under two years. After the invasion, the price shot up to Ksh.5,100 in under a week,” said edible oils subsector chairman, Abdulghani Alwojih.

The uptick in price of basic commodities can also be anchored on a weakened shilling which has within a week continued to lose value against the US dollar.

On Tuesday, the Kenya shilling hit a 14-month all-time low to 114 units against the US dollar, signaling a looming crisis in commodity prices.

According to the Central Bank of Kenya (CBK), the Kenya shilling hit a record low to trade at an average of Ksh.114.19 per dollar on Friday.

The weaker shilling is anchored on the intensified Russia’s invasion of Ukraine amidst damaging sanctions that the United States has imposed on Vladimir Putin, by way of dropping offense against President Zelensky.

Ukraine, which accounts for 76 percent of global sunflower oil exports, has cut its supplies. The disruption of alternative oil supplies – sunflower and soybean oil has fueled a rally on palm oil form Indonesia.

As result, Indonesia is enforcing a 20 percent retention of all planned oil exports to be sold in the domestic markets to control their prices, affecting import volumes to Kenya

Kenya is a large importer of vegetable oils such as sunflower oils, soybean, corn oil and commonly used crude palm oil mainly from Malaysia and Indonesia, which produce more than 90 percent of global supplies.

According to Kenya National Bureau of Statistics (KNBS), food and non-alcoholic beverages index went up by 0.83 percent in February.

A two kilogram pack of sifted maize flour for instance now costs Ksh.129.25 from Ksh.126.31 while a 400 gram loaf of white bread costs Ksh.55.85 on average from Ksh.55.19.

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