•The state was eyeing importation of 125,000 tonnes of cooking oil duty-free through the Kenya National Trade Corporation (KNTC) to tame the runaway shelf prices of the product.
•The government risk losing Sh52 billion in taxes annually, if the protracted standoff between the government and edible oil manufactures persists.
Image: MARTIN MWITA
Government officials gave the Malaysia Palm Oil Forum (MPOF) in Nairobi a wide berth after they failed to take part amidst the ongoing struggles with local industry players.
This coming amidst the ongoing push by the state to seek partnerships to grow the local palm industry.
The state officials failed to attend the event despite the Malaysian Deputy Prime Minister Dato' Sri Haji Fadillah being in attendance.
The industry players have been in a push and pull with the state over the planned importation of edible oil that risks sinking some of the edible oil manufacturers.
In the event the private sector and the industry players did not include any state officials in the events programme.
Decrying tough operating environment with their umbrella association, KAM has expressed fears that the sustained duty-free importation of edible oils could equally signal the closure of decades-old key industries.
Among the contentious issues between the state and the edible oil sub-sector has been the two percent levy charged on imported oils and Nuts.
The manufactures argue that the two per cent Nut and Oil Crops Development Levy they pay should be utilised to develop palm, soya and sunflower farming in the country.
“The companies are currently operation at a capacity of 40 percent. It’s not because they can’t meet local capacity. Currently Kenyans consume about 800,000 litres against industry capacity of about 2 million,” one of the players told the Star on the sidelines of the forum.
However, government had stayed firm in its planned importation until Friday when the High Court suspended the plan.
The state was eyeing importation of 125,000 tonnes of cooking oil duty-free through the Kenya National Trade Corporation (KNTC) to tame the runaway shelf prices of the product.
The government approved the decision in November last year in a bid to stabilize prices after a prolonged drought that led to a shortage of household supplies and higher food prices.
KNTC was also going to import rice amounting to 150,000 tonnes, sugar (200,000 tonnes), wheat (25,000 tonnes) and beans (80,000 tonnes) as part of wider efforts to bring down the cost of food.
However, edible oil manufacturers have faulted the move claiming that the decision will drive them out of business, a move that has also seen the Law Society of Kenya (LSK) move to court.
They say the government risk losing Sh52 billion in taxes annually, if the protracted standoff between the government and edible oil manufactures persists.
The cost of edible oils shot up during the COVID-19 pandemic, and has since been spiralled by global shocks including the Russia-Ukraine war and the decline in the value of the Kenya Shilling against the dollar, which traded at a high of Sh140.67 on Tuesday.