Food costs remain high as oil prices drop

A mini market survey carried out by The Business Times around major commercial markets in Kigali has found that food is still expensive despite a fall in prices of petroleum products on the world market.

A mini market survey carried out by The Business Times around major commercial markets in Kigali has found that food is still expensive despite a fall in prices of petroleum products on the world market.

Reports indicate that petroleum prices on international markets have plummeted head-over-heels, with a barrel reported to have dropped below $70 (Frw38,399).

This is a record drop from a high of $145 (Frw79,542) in July this year.

But at Kimironko market, the biggest shopping centre in Kigali City, prices of green peas, consumed by many Rwandans are still at Frw1,400 per kg.

Beef is at Frw1,800 per kg while the price of Irish potatoes and tomatoes remained at 135 per kg and Frw1,000 per kg respectively.

Beans, the common dish in the country has also stayed at Frw400 per kg (dry) and Frw700 (fresh).

The prices of edible oil and imported rice have also gone up substantially since March this year.

A five kilogrammes packet of Basimati Rice that used to cost Frw5,000 increased to Frw6,500. While the Tanzania rice costs Frw800 per kilogramme.

Attendants in Kimironko market blame transporters for the rising prices of food stuffs yet fuel costs have dropped. But transporters say the fall in oil prices has not been felt by the transport sector. 

Nadia Umutoni an attendant in the market said as a result, transport fares have remained high. Transporters still claim fuel is still costally.”

Recently Col. (rtd) Dodo Twahirwa, the president of the Association for Transport Companies (ATRACO) said, they are not planning to reduce the fairs but rather asking RURA to increase the charges.

Since October 6, 2008 fuel was reduced by 4.761 percent. The pump price for petrol reduced from Frw924 to Frw880 while diesel is now Frw870 from Frw924.

Government has since then called upon responsible institutions like Rwanda Utility Regulatory Agency (RURA) to intervene and regulate transport costs, meaning there would be a positive impact on market response which would ease pressure on commodity prices and inflation.

However, Col. Diogène Mudenge the Director General of RURA, the regulating body recently said that there may not be a significant impact but studies about it are on.

State Minister for Industry and Investment Promotion, Vincent Karega said his ministry may not intervene as some of the foodstuff  is imported.

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