Business
Lower food prices bring relief to struggling households
Fruits and other food items are in plentiful supply in Kampala
Every dark cloud has a silver lining, so they say. So while the heavy rains have left many communities cut off as floods washed away bridges, there’s something to cheer about the just ending first rain season of the year. The country is beginning to experience bountiful food harvest.
The favourable food situation is being witnessed in many parts of the country, especially in urban areas where oversupply is already causing prices to the ground.
Matooke, the biggest staple in Central region, Western and Southern parts of the country, is plentiful in markets. A medium-sized bunch of plantain now goes for an average of UGX15000. But one would not be surprised to get it at UGX10,000. Sweet Potatoes have also started to make a comeback into the market after a prolonged period of scarcity of the root crop, largely due to the prolonged period.
Fruits ranging from passion fruits, mangoes, and oranges and some vegetables like Tomatoes, Onions and cabbages are also in plentiful supply.
The drop in food prices is not only welcome news for consumers, but also for the government because of the vital role that food inflation plays in the overall level of prices of goods generally and impact on people’s standard of living and the economy as a whole.
The only downside to the current lower food prices is that they will be shortlived, due to their perishability. According to Uganda Bureau of Statistics (UBOS) May figures, Annual food price inflation registered a major decline from 25.3% to 15.7%.
The favourable situation in food prices is contributing towards a decline in overall inflation from 8% recorded for the year ending April 2023 to 6.2% for the year ending May 2034.
The generally lower level of prices of perishable food stuffs will also help to cool down runaway prices of cereals such as rice, maize, simsim and soya which had shot through the roof.
The 6.2% inflation rate is closer to the government target of 5% for the financial year 2022/23.
According to UBOS Executive Director Dr. Chris Mukiza, Uganda’s Economy grew by 5.3% in the fiscal year 2022/23 compared to a revised growth of 4.6% in 2021/22. The country’s GDP also expanded from UGX162 trillion to UGX184 trillion in 2022.
Meanwhile UBOS said that it forecasts the Services sector to be the biggest contributor to GDP this year with a 42.6% share in 2022/23 compared to 41.6% recorded in 2021/22.
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