Wheat shortage pushes bread prices up by Sh2

By LUKE ANAMI

Retail price for bread has increased by over five per cent with the Ministry of Agriculture denying it is responsible for the move.

A spot check in supermarkets and shops in various estates indicate bread is now costing Sh37 up from Sh35 since last week. In some instances bread has increased to Sh40 catching most consumers by surprise.

A baker. Russia a key wheat grower and exporter is cancelling contracts until December after drought and wild fires ravaged through its vast fields. [PHOTO: FILE / STANDARD]

Agriculture Minister Sally Kosgei attributed the move to increased wheat prices worldwide.

"International prices of wheat have gone up prompting the increase," Kosgei said during a stakeholders meeting on horticulture on Monday at Kilimo House, Nairobi.

Commodity prices have risen 25 per cent this week as drought and fires devastated crops in Eastern Europe. Russia has banned the export of grains.

Wheat landing at Mombasa before duty is paid is at Sh28,944 ($360) a tonne up from Sh19,296 ($240) a tonne, a month ago.

Consequently, wheat flour price has increased from Sh4,300 a bag (90-kilogramme) to Sh5,000 in the last one month.

Dr Kosgei exonerated the Government from the increment when she announced that millers would now buy wheat at a fixed price of Sh2,700 per bag from local farmers.

negotiations

"The fixed price came as a result of negotiations with millers to cushion farmers against the consequences of East African Community (EAC) 10 per cent duty on wheat," She said.

Kosgei said despite being no respite for the EAC partner states to review the duty on wheat, her ministry will look for ways to ensure Kenyan farmers do not suffer consequences in terms of low wheat pricing.

On horticulture, Kosgey said the Government was exploring ways of reducing taxes on horticulture as one of the ways of addressing challenges in the sector.

"We are examining the horticulture production chain to identify areas the Government could intervene to assist players in the sector," said Kosgei.

The Minister was flanked by the PS Romano Kiome.

In his 2010/2011 Budget proposal to Parliament in June, Finance Minister Uhuru Kenyatta proposed the lowering of duty on imported wheat from 35 per cent to 10 per cent, to conform with charges by other member stattes in the EAC.

The decision has seen disquiet grow among farmers in Narok, the country’s grain basket, who claim the Government had failed to protect them.