East African Business Week

Kampala, Uganda - First it was fuel, then sugar, and now it is charcoal.
Despite the rains that have continued pounding most parts of the countryside with floods in some areas, and the harvest, prices of staples like maize, groundnuts, and rice have continued to go up.
Since January 2011, commodity prices have been on the rise.
 Despite the rise global price shocks, there is apparently not a comprehensive clarity by the authorities on the continued increases.
Continued rise in global and regional commodity and fuel prices has triggered food insecurity.
The major cause of price rise hinges on the rising dollar rate which stands at Ush2885 per US Dollar up from the January rate of Ushs2200 per US Dollar in January 2011.
Maize flour, groundnuts and rice are still at Shs1,600, (less than US0.41)  Shs4,000 (about US$ 1.75) and Shs3,000 (about US$1)  per kilogramme respectively as opposed to less than aUS$1 (Shs700,  Shs2,000 and Shs 2200)  at the beginning of the year
The erratic increase in commodity prices has sparked concerns from Ugandans whose biggest population to, survive on less US$1 per day.
Fuel pump prices in Kampala city have risen by about 40% from US$1 (Shs 2,800) at the beginning of the year to now US$1.40 (Shs3,900).
In the countryside, pump prices are at between US$1.40 and US$1.50.
Sugar shot up from less that US$1 (UgShs2,200) and more than tripled to about US$3 (between Ugsh7,000 and 8,000 ). Government efforts to import sugar outside the region to subsidise the inadequate local production, have not yielded any fruits.
Charcoal  largely used for cooking, shot up from Shs25,000 (US$10) and more than tripled. Charcoal now sells at between Shs70,000 to Shs80,000 (US$35) per bag.
The surge in commodity  prices, is being blamed on the volatile fuel prices.
"Fuel is expensive so we have to charge our customers accordingly," says one Juma, a lorry driver and transporter.  The liberalisation of Uganda's fuel market gave fuel dealers the monopoly to set their own pump prices.
Given the situation , the Ministry of Finance, Planning and Economic Development through the Economic Development Policy and Research Department (EDP&RD;) is conducting a study titled:   “The Impact of food price change on the Ugandan Economy."
The study aims at examining the impact of changing food prices on the Ugandan economy, with particular attention to poverty levels, agricultural commercialization and structural trans-shipment.
It is expected to take eight weeks but it is not clear whether the outcome will have an impact on the economy.
"We are conducting a study, but it is too early to talk about it when we haven't taken off," a Ministry of Finance official said on condition of anonymity.
 "We are looking for researchers and we will soon embark on the process."
Economists argue that the trend in movement of commodity prices appears to have grown to unusual proportions in the recent period.
Many commodity prices are near or above the 2008 peaks that sparked off food riots around the world.
At a Press briefing on August 2nd, 2011, Prof. Emmanuel Tumusiime-Mutebile, Governor Bank of Uganda announced the raising of the Central Bank Rate (CBR) from 13% in July 2011 to 14% in August 2011 and finally to 16% in September.
The further tightening of monetary policy was aimed at preventing the current food inflation from feeding into higher inflation for non-food items, by curbing the growth of aggregate demand and hence spending on goods and services.
It is expected that as spending growth subsides, inflationary pressures will ease.