Diapers, sanitary towels, detergents to cost more in new waste rules

Consumers are staring at a sharp price increase on packaged commodities, with diapers, sanitary towels and detergents expected to be among the most affected, as the government readies to effect new waste rules.

The National Environment Management Authority (NEMA) plans to start effecting the Sustainable Waste Management (Extended Producer Responsibility) Regulations, 2024, on February 3, even as the private sector warns that the industry is not ready.

The rule which comes with extra costs for manufacturers, importers and retailers, will see players in the value chain held accountable for the entire lifecycle of their products, including post-consumer waste management and environmental impacts, which comes with an extra cost.

These regulations affect plastics, paper, glass, metal and aluminium packaging, electronics, batteries, motor vehicles, tires, among other products.

Major concerns by the private sector players include the high cost of compliance, where for instance, an importer is required to pay Sh150 per item for every consignment brought into the country.

In addition, the importer must obtain an import permit for each shipment, which carries further financial implications.

Producers are also mandated to register individually with NEMA, paying a one-off registration fee of Sh5,000 or Sh10,000 under the collective action scheme (Producer Responsibility Organisation - PRO) and an annual renewable license fee of Sh50,000 for individuals or Sh100,000 for schemes.

“The cumulative impact of these costs will directly increase the cost of importation and manufacturing. Inevitably, these additional operational expenses will be passed on to consumers, leading to higher retail prices for essential products such as diapers, sanitary towels, detergents and fabric softeners,” private sector groups  say in a joint memorandum seen by the Star.

They include the Kenya Private Sector Alliance, Association of Kenya Suppliers, Kenya Flower Council, Fresh Produce Consortium of Kenya, Kenya International Freight and Warehousing Association (KIFWA) and the Shippers Council of Eastern Africa (SCEA).

For instance, a jumbo pack of 60 diapers is expected to increase from Sh2,000 to Sh2,553. A baby typically requires approximately 2,520 diapers annually, which will cost families an additional Sh23,000 per year.

A 14-pack of sanitary pads, on the other hand, is expected to go up by at least 20 per cent from an average Sh218 to Sh261.60, a burden that disproportionately affects school-going girls and low-income women, risking increased absenteeism, reduced academic performance and potential health issues from unsafe alternatives.

Old blankets, tissue paper, mattresses and cotton wool are some of the items poor girls use during their periods for lack of sanitary towels. 

Consumer goods like bread, alcohol, cosmetics and all packaged commodities are also expected to go up as players in the supply chain pass on additional costs to consumers.

Industry players are questioning how NEMA came up with the flat Sh150 levy per item which ignores weight, material, recyclability, or environmental risk, among other inflated and inconsistent charges.

There is also the concern of duplications and double payments where firms are already paying PRO fees to Producer Responsibility Organisations and county governments.

Manufacturers also cited misclassification of imports where raw materials and intermediate goods are treated as finished goods, conflict with the East African Community trade framework,  where the rules undermine the Common External Tariffs and lack of  evidence on economic and environmental impact.

Price increases on commodities are projected at between nine per cent and 24 per cent, per item, for every imported item since there are no exemptions.

The new regulations impose heavy fines for producers who fail to adhere to the requirements, including a fine of up to Sh2 million or even imprisonment.

Industry engagements show that, as recently as last week, less than five per cent of suppliers and manufacturers are currently compliant with the NEMA regulations, with many still registering and affiliating with approved Extended Producer Responsibility schemes.

Suppliers and retailers have since warned that they could be forced to pull goods from shelves as majority of manufacturers are yet to comply, in what could lead to a basic commodities shortage across the country.

“We are not against the environmental conservation rules but how they are being implemented is where the problem is. The costs will be extremely high,” Association of Kenya Suppliers CEO, Ishmael Bett, told the Star.

The Retail Trade Association of Kenya said the industry supports the policy but is well aware that, based on engagements with manufacturers and suppliers, the supply chain is not ready for full enforcement.

“While retailers have been engaging suppliers to accelerate compliance, they caution that abrupt enforcement could disrupt supply chains, leading to limited product availability on shelves, higher consumer prices and pressure on local manufacturers and SMEs,” RETRAK CEO Wambui Mbarire said.

“We are calling for a phased enforcement approach, prioritising producers and importers in line with EPR principles, with clear transition milestones to protect business continuity while compliance scales up.”

The Shippers Council of Eastern Africa (SCEA), which represents the interests of importers, exporters and other stakeholders in the logistics and shipping, has urged a temporary suspension of the implementation to allow discussions on, among others, the Sh150 per item charge and other constraints the industry has identified.

SCEA chief executive Agayo Ogambi said the EPR will adversely affect investment, business expansions and consumers.

“SCEA in principal support the need for a sustainable business environment, but finds the EPR punitive and expensive.  We are still not certain about how the implementation shall be incorporated into the import process.  What systems shall be used, and if the system is ready, tested and piloted,” Ogambi told the Star.

“We would hate to see delays in port clearance occasioned by challenges in the implementation of the EPR. The cost implication to imports for either finished good and raw materials remains unknown, but it will definitely lead to high production costs, uncompetitiveness and higher consumer prices.”

He noted that the Port of Mombasa is already facing severe constraints. Ogambi also raised concern over the continued imposition of levies and fees by government agencies at the port and other points of entry.

“We are at a point where every government agency is targeting imports for revenue. This is definitely not sustainable in the long run,” he said.