By Benadeta Mwaura - Reporter
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Kenya, 20 April 2026 - Kenyan manufacturers are warning of imminent price increases across a wide range of goods as the ongoing disruption in the Strait of Hormuz continues to choke global supply chains and drive up import costs.
The Kenya Association of Manufacturers (KAM) says the crisis, triggered by the Iran war, has significantly affected the flow of critical raw materials, fuel, and intermediate goods into the country, raising production costs and squeezing already thin margins.
At the height of the crisis, the Strait of Hormuz, through which about 20 percent of global oil supply passes, experienced near-total disruption, with tanker traffic dropping sharply and shipments delayed or rerouted, pushing global energy and freight costs higher.
Manufacturers say the impact is already being felt across multiple sectors, from food processing to construction and consumer goods.
The disruption has not only increased the cost of fuel, but also driven up the price of key industrial inputs such as plastics, chemicals, and fertilisers, many of which depend on Middle Eastern supply chains.
Globally, petrochemical prices have surged as the crisis choked supply routes, with some manufacturers passing on cost increases of up to 50 percent to end consumers.
For Kenya, which relies heavily on imports for both fuel and industrial raw materials, these pressures are quickly translating into higher production costs.
And as manufacturers absorb these costs, they are increasingly being passed down the value chain.
The crisis has exposed how deeply Kenya’s manufacturing sector is tied to global logistics networks.
Shipping delays, higher insurance premiums for vessels navigating the Gulf, and longer alternative routes have all contributed to increased landed costs for imports.
Even before the latest escalation, Kenyan fuel retailers had already reported supply strains, with about 20 percent of outlets affected due to disruptions linked to the Middle East conflict.
Manufacturers now warn that similar pressures are emerging in the industrial supply chain, with delayed shipments and higher costs threatening production timelines.
Beyond industrial goods, the impact is also extending into food production.
The Strait of Hormuz is a critical corridor for fertiliser exports, and disruptions have already pushed global fertiliser prices higher, with projections indicating increases of between 15 and 20 percent in the first half of 2026.
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This has direct implications for Kenya’s agricultural sector, where higher input costs could reduce yields and further push up food prices in the coming months.
Global analysts have warned that the Iran conflict could trigger a fresh food price shock across developing economies, reversing gains made in stabilising inflation.
For Kenyan households, the warning from manufacturers signals a new phase of the economic impact.
Fuel price increases have already pushed transport and logistics costs higher. Now, with manufacturers preparing to adjust prices, the effect is expected to spread across everyday goods.
This comes at a time when the cost of living is already elevated, raising concerns about reduced purchasing power and slower economic activity.
Economists warn that rising input costs across manufacturing could feed directly into inflation, complicating efforts by the Central Bank of Kenya to maintain price stability.
While fuel has been the most visible trigger, manufacturers insist the crisis is broader.
It is about supply chains, currency pressures, and global market volatility converging at once.
The Iran war has disrupted not just oil flows, but entire production ecosystems, from energy to agriculture to manufacturing inputs.
For Kenya, the challenge now is not just managing fuel prices, but navigating a wider industrial shock that could reshape production costs, consumer prices, and overall economic growth.
And as manufacturers warn, the next wave of impact may not be at the pump, but on the shelves.