Bakers, eateries reel from hefty Uganda eggs taxes – Business Daily

Ms Victoria Ollewe at her workplace in Migosi Estate in Kisumu. PHOTO | ELIZABETH OJINA | NMG
Victoria Ollewe, a baker in Kisumu, has to walk kilometres from Migosi Estate to Kondele in search of chicken eggs.
She is crossing her fingers hoping to find just a few crates. For two weeks now, Kisumu and other parts of western Kenya have been facing an acute shortage of eggs.
The government’s decision last year to impose a 25 percent tax on imported eggs drastically cut cheap supplies from the market. It has not helped that most local farmers sold their aged flock in December to bring younger layers, exacerbating the shortage and sending the price of a single egg as high as Sh15.
For Ms Ollewe to smoothly run her baking business, she needs at least 15 crates in a month.
“At any given time I have two wedding and several birthday cake orders. Some clients place orders on short notice, meaning I must have eggs on standby,” she explains.
Just two months ago the standby eggs used to cost her Sh4,800 with a crate going for Sh320. But with the biting shortage, the cost has risen 25 percent to Sh6,000 with each crate now retailing at Sh400.
As a business person in the highly competitive bakery sector, this has left Ms Ollewe with few tough choices to make. She could either push the extra expenses to the consumer or cut down on costs elsewhere and risk compromising the quality of her cakes and the reputation she has worked hard to build.
Pushing the cost to the consumers who are already bearing the burden of the rising cost of living, she says, has been tough, forcing her to turn down orders.
“Definitely the rise in eggs prices has affected the price of cakes. Unfortunately, consumers don’t understand this,” she says.
“The shortage has really affected my business, which is my source of livelihood. If it persists, I will be out of business soon.”
But bakers are not the only business people being driven out of the market by the enhanced tax. Hoteliers in the region have started feeling the pinch of egg scarcity.
Kena Shah the manager of Imperial Express Hotel in Kisumu says they have to source eggs from Eldoret due to the shortage.
“We have three suppliers and we keep a minimum stock of 30 trays. We also get our trucks to get us eggs from Eldoret if we can’t get them here. We have a negotiated price of Sh330,” says Kena Shah.
Faced with the high taxation, Several eggs traders have since abandoned the venture.
Collin Otieno, one of the wholesale dealers in Kisumu says finding enough eggs to satisfy the local demand has become harder.
“For a month now there’s been heavy restrictions at the border since the tax was imposed,” notes Mr Otieno.
He adds that the majority of those who used to import eggs from Uganda have closed shop, unable to cope with the restrictions.
Consequently, he says, the scarcity has encouraged the rise of a black market that sees traders sneak in eggs across the porous border.
Usually, they hire a truck to ferry about 3,000 trays from the neighbouring country on a weekly basis. They buy each crate at Sh310.
The estimated consumption in Kisumu is at least 800,000 table eggs in a single day. However, the County relies on imports because local farmers cannot meet the demand.
Kenya Poultry Farmers director Ronnie Hezron notes that Kisumu gets eggs from Isinya in Kajiado and Naivasha in Kiambu.
“Sometimes the dealers in Isinya prefer selling the eggs in Nairobi and Machakos where there is a higher demand than Kisumu,” observes Mr Hezron.
He explains that most farmers sold off their layers in December during the festive season to bring in another set of layers.
“Layers take up to six months to start egg production. The peak production begins when they are seven or eight months old. The circle would go for 17 to 18 months before a farmer replaces it,” explains Kenya Poultry Farmers director.
He adds: “Right now we have to source for eggs as far as in Yala. We are selling a tray at Sh370 but if the shortage persists, we will begin selling a tray at sh400.”
Ufanisi Resort, Kisii manager Maurice Odhiambo says the hotel has resorted to keeping layers to ease the scarcity.
“The shortage is already being felt in Kisii. We are keeping layers but the price of poultry feed is too expensive,” laments Mr Odhiambo.
Kisumu CEC for Agriculture Gilchrist Okuom notes that the increase in the price of poultry feeds could have played a great role in egg pricing.
Currently, a 70kg bag of chick mash is retailing at Sh4,200 from Sh3,250 last year while layers mash goes for Sh3,800 from Sh3,100.
“During the Covid-19 pandemic, a number of companies dealing with the production of animal feeds closed shop. The few remaining hiked the price of feed due to limitations of raw materials,” said Mr Okuom.
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By Kwetu Buzz

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