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Food: Maize subsidy hot issue as country heads back to ballot

By Dominic Omondi | Published Tue, September 5th 2017 at 08:29, Updated September 5th 2017 at 11:59 GMT +3
Local supermarket showing no limit of buying maize flour (Photo by WILLIS AWANDU)

In summary

  • Fresh presidential polls put the Government in a dilemma as ending subsidised maize flour programme could encounter backlash from voters while farmers also need protection.
  • The maize subsidy programme, which was unveiled to address the skyrocketing price of flour was supposed to end by late August.

NAIROBI, KENYA: Just when President Uhuru Kenyatta and his Deputy William Ruto were about to settle down and end the controversial maize subsidy programme, the Supreme Court sent them back to voters.

Anything they do now could get a a backlash from a section of the electorate. As harvest from the North Rift and South Rift, and parts of Nyanza and Western start finding their way to the market. The duo who have already hit the campaign trail will need to ensure that farmers get better returns for their produce.

Unfortunately, urban dwellers who seemingly are still reeling from the hangovers of cheap unga which for the last two months has been retailing at Sh90 for a two-kilogramme and Sh47 for a one-kilogramme, might not appreciate it when the prices revert to where they were before the subsidy.

The maize subsidy programme, which was unveiled to address the skyrocketing price of flour was supposed to end by late August. The price of maize flour was a hot campaign issue, particularly following a devastating drought that suppressed crop harvest.

The price of the grain, together with other foodstfuff went through the roof - beyond the reach of ordinary Kenyans - for whom food takes up a huge chunk of their budgetary allocation.

The opposition, led by former Prime Minister Raila Odinga, latched on to the crisis, accusing the Jubilee Government of failing to ensure Kenyans had access to unga.

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The drought, which pushed nearly four million Kenyans on the precipice of starvation, also affected sugar and milk - making life tougher for most households. Retail stores quickly ran out of unga, even as the price of a two-kilogramme packet shot to unprecedented levels.

“Production of maize decreased in 2016 due to lower volume of rainfall, high costs of farm inputs and the residual effects of Maize Lethal Necrosis Disease,” said the Kenya National Bureau of Statistics in the Economic Survey 2017.

Production of the cereal reduced from 42.5 million bags in 2015 to 37.1 million bags in 2016. The maize produced and taken to the market in 2016, declined. The value of marketed maize declined by 7.2 per cent to Sh7.9 billion.

Normal supplies

Although the country never experienced food riots as in Mozambique, the opposition saw in this an opportunity to craft their campaign messaging around the ‘unga revolution.’

This would not have gone down well with a Government that wanted to win the support of the majority of the poor. The UhuRuto duo needed the electorate to give it another chance.

As such, the Government decided to literally buy unga for its citizens. Because there was no maize coming from the country’s crop-growing areas as well as in the neighbouring countries, the Government started by giving licenses for the importation of the grain from overseas.

“The importation would be required up to end of August 2017 when early harvest crop is expected, especially from parts of Nyanza, Western and South Rift Regions,” said Cabinet Secretary for Agriculture Willy Bett in a submission to the National Assembly. Kenya imported white maize from Mexico, Zambia, South Africa, Malawi and Ethiopia. But what came to be known as the maizesubsidy programme went beyond importation because as the Government put it, importers and millers were not passing on the benefit of cheap maize to the consumers.

In a report to the Parliamentary Committee on Food Security, CS Bett noted that Sh90 for a two-kilogramme packet of unga and Sh47 for a 1kg one “was the price attained during the normal maizesupplies in the country.”

“Based on the inflation and consumer price index changes, a price of Sh90 per two kilo and Sh47 per one kilo pack were set. The decision was based on survey records which showed that this was the price attaining during the normal maize supplies in the country. This translates to the price of Sh2,300 per 90 kilo bag of maize grain,” read the report.

Moreover, the ministry was tasked to explain how the programme would ensure value for money. To this end, it explained to legislators that a decision was made for the “Government to acquire available maize stocks both locally and imported through the normal Government procurement procedures.”

“This was guided by a survey of prevailing local, regional and international market prices and direct negotiations with traders, thus arriving at a price of Sh3,600 per 90-Kg bag,” Bett told Parliamentarians. The subsidy programe, like any other price control mechanism, had its initial challenges. Most people could not find the cheap unga from the shops and even some supermarkets.

There were ugly scenes of Kenyans jostling for the commodity in various supermarkets. The opposition took note, telling their supporters that even the cheap unga that the Government promised was not in the shelves of most retail stores.

However, with time, things got better. The rains set in in parts of the country, enabling farmers to grow more crops. Supply of cheap maize flour also got better. There was no more scrambling for it. Kenyans literally got used to the fact that unga was supposed to retail at Sh90. 

To many political analysts, reverting the price to the normal rate with a rerun looming would be akin to committing political suicide.

Kenyans are, therefore, waiting to see the next step the Government takes on this front as the quest for votes intesifies.