Bread prices in Kenya projected to rise on Ukraine-Russia war

NAIROBI, Kenya, Feb 25 – The ongoing Ukraine-Russia geopolitical tension has made headlines across the globe with many, including Kenyans expressing concern about its potential to trigger world order and economy.

While the crisis has already impacted global oil prices which has been pushed past USD100 per barrel, Ken Gichinga, the Chief economist at Mentoria economics, says that the crisis could also trigger wheat prices in Kenya in the short and medium term.

Being a large importer of wheat from Russia, Gichinga says that should the conflict escalate, Kenyans would have to dig dipper into their pockets to purchase wheat products including bread.

“Kenya imports a bit of wheat from Russia and potentially if there is a full blown conflict, the wheat volumes may go down and prices go up, the global supply chain will be affected and millers may not get enough,” he said.

Kenya imports eighty percent of the commodity with Russia accounting for the highest proportion.

According to data by the Kenya National Bureau of Statistics (KNBS),  Kenya produced 366.2 tonnes of wheat in 2020 and imported 1,882.5 tonnes.

While there may be a potential to opt for other sources, Gichinga noted that the  complexity of contracts, marketing and negotiation will prolong the exercise.

On the flip side, however, he noted that the crisis could trigger domestic purchases as the government will be forced to re-strategise and source locally.

“It might put local wheat farmers at a strategic point, bread millers will have to continue  their operations and the local farmers will start benefitting from a bigger demand and will expand their production,” he added.

Besides oil and wheat, Gichiga noted that it could also impact Kenya’s security with Nairobi sourcing most of its large armamaent overseas in addition to the small arms which have recently started being produced locally.

“Russia is a larger supplier of arms, you might find on the larger arms and with countries increasing bugdets, I think the the security sector might see some change,” he added.

Weighing in on the matter, Kenya Association of Manufacturers(KAM) Chair Mucai Kunyiha noted that the Ukraine-Russia conflict will have some ramifications on global trade and the global economy as a whole.

“We need to be prepared for such situations as a country by being solid internally to ensure we are not that affected,” said Kunyiha