Uganda, Tanzania maize imports stabilise flour prices in Kenya

By By NICHOLAS WAITATHU | Published Tue, August 20th 2013 at 00:00, Updated August 19th 2013 at 19:48 GMT +3
The price of popular maize flour brands has remained stable for the last six months due to imports from the neighboring countries as well as the start of the harvest period. [PHOTO: FILE/STANDARD]


Millers have upped the ante on maize imports from neighbouring countries to sustain the local market as stock dwindle.

Between March and August this year, millers have imported about 300,000 tonnes of maize from Tanzania and Uganda.

The imports have stabilised the price of flour, which has been edging down marginally in the past few months.

The chairman of the Cereal Millers Association Diamond Lalji said millers have been buying maize at between Sh2,600 and Sh3,000 per 90 kilo bag.

“Millers have exhausted all their stocks, but stable supply of maize from Uganda and Tanzania has ensured we receive enough maize, and at the same time maintain the prices of flour at affordable levels,” said Mr Lalji last week.

Sustaining demand

 Lalji noted that imports from the two countries play a critical role in bridging the deficit, giving millers relief at a time they can ill-afford to import maize from countries outside the EAC following the re-introduction of duty on imported maize.

“We are charged 50 per cent tax when we import maize and that is a thing that we cannot think of doing right now,” said Mr Lalji. “Cross-border trade has been key in ensuring we have enough stocks to sustain the demand.”

In local supermarkets, a two kilogramme fortified maize flour packet is retailing at Sh103 having decreased from a high of Sh116 in February this year.

 According to the National Cereal and Produce Board (NCPB), the local strategic grain reserve has 2.1 million bags of maize, much less than the 3 million bags required to cushion the market against shortage.

NCPB spokesperson Evans Wasike in an interview explained that stock carried over from the previous season has been sustaining the market since March this year.

“The strategic grain reserve is currently performing at slightly above 2 million bags stored in board depots across the country.  The price of maize has been stable since last year  - an indication the industry is not badly off,” he said in phone interview.

Farmers from South Rift Valley and parts of Nyanza are currently harvesting maize crop. He said the new harvest will replenish the grain reserve.

Wasike observed that farmers from Western region will start harvesting their crop at the end of this month and in early September while a huge harvest is expected from the North Rift between November and February next year.

Every year,  the country harvests close to 40 million bags against consumption of more than 41 million bags of maize.

 Yearly consumption

This year according to Wasike, production reached the 40 million bags mark, which was still was below the annual consumption.

The Ministry of Agriculture indicates that by June, millers were in possession of 461,215 bags of maize and traders were holding 1,880,910 bags. The country consumes a minimum of three million bags monthly.

The price of a 90-kilo bag of maize in Kenya, Wasike said, stands at about Sh3, 000, but hastened to add that the same is expected to drop as farmers start harvesting in the South Rift and Nyanza regions.

But local researchers warn that delay of fertiliser early in the season and subsequent massive destruction of the crop during the long rains, will result in low production.

Francis Karin, a senior research assistant with Tegemeo Institute of Agriculture Policy and Development says production in the current year will dwindle owing to delay in supply of fertilizer to farmers.

He added, during the long rains huge percentage of crops were destroyed and farmers in some areas did not bother to replant.

“We had a good harvest last year, but in the current year, yield will eventually decrease owing to the said factors and to a large extent will affect food security,” he said during a recent interview in Nairobi.

KipKorir Menjo a farmer in the Rift Valley shares similar sentiments saying the government is to blame for the projected low production.

 He noted that the outbreak of a viral disease - lethal necrosis - in parts of Rift Valley will also affect maize production.