Why you’ll soon dig deeper into your pockets to put ugali on the table
Kenyans will pay more for maize flour as several millers suspended operations due to an acute shortage of the grain.
Kenyans will pay more for maize flour as several millers suspended operations due to an acute shortage of the grain to the point they cannot sustain operations for the next one month, even after the government authorised the importation of duty-free maize into the country.
Millers say what is in stock will last less than two weeks, and petitioned the government to put in place measures to cushion consumers from the high cost of flour.
“The acute shortage of maize in local and regional markets has pushed most millers to halt operations and sack workers,” said Mr Wilson Too, a miller in Eldoret.
The cost of maize flour has hit Sh230 for a two-kilogramme packet in most retail outlets in the North Rift region, with the government banking on the importation of 10 million bags of duty-free maize to lower the cost of the staple.
Some 42,464 tonnes of yellow maize from Ukraine landed in Mombasa on Sunday, but millers have warned that the imports will only translate to a minimal reduction in the cost.
According to the millers, the shipment is meant for making animal feeds and is expected to ease pressure on demand for white maize for human consumption.
“What is required is a steady supply of the maize in the local market to help sustain our operations and lower the cost of flour,” said Mr David Maina, a miller in Eldoret town.
The millers have asked the government to allow yellow maize for human consumption.
“We are staring at a looming disaster as the maize supply in the market deteriorates further, after most farmers sold out the grains during the harvest period. Consumers should be ready to dig deep into their pockets to access the staple as we experience more difficulties sourcing maize to sustain our milling operations,” said Willy Kosgei, another miller.
Expressed fears
The millers have expressed fears that the imported maize will not sell at the anticipated Sh4,200 per 90-kilogramme bag as desired by the government due to the acute shortage of the grain on the global market, which has pushed up prices.
Maize prices have hit Sh6,200 up from Sh4,800 per 90-kilogramme bag in most parts of the North Rift region —the country’s grain basket — and the prices are likely to increase further due to the biting shortage.
The National Cereals and Produce Board (NCPB) has admitted that it has no emergency maize stocks and is faced with stiff competition from traders and millers who offer better prices and prompt payment.
The board has reviewed its prices from Sh5,100 to Sh5,600 per 90kg bag to woo farmers to deliver the product to its buying centres, but so far it has purchased less than 60,000 bags, mainly in the North Rift region.
The latest global food index for December 2022 by the Food and Agriculture Organization (FAO) indicates an international rise in maize and rice prices by 6.2 per cent, due to tighter availability of the commodity and a strong demand in Asian exporting countries.
“World maize prices have increased, influenced by a strong demand for export from Brazil and Paraguay and a strong import demand in the European Union. Lowered stocks in Ukraine due to disruption in production are largely behind the change,” stated FAO in the report.
According to the Kenya National Bureau of Statistics, Kenya has imported an average of 295,092 tonnes of maize annually over the past five years.
An estimated 5.1 million families especially in Northern Kenya are faced with starvation with the Ministry of Agriculture warning that the country has maize stocks to last only until the end of the month.
According to the Ministry of Agriculture, the country, as of last month, had a stock of 6 million bags of maize that can last up to the end of the month as maize prices escalate, hitting Sh6,200 per 90 Kg to the pain of consumers who have to pay more for the produce.
“There is a need to manage prices of unga. There are indications that we might not have enough grain. Food stocks are expected to last for two months up to March 2023-6 million bags,” stated a report following a meeting between President William Ruto and maize millers two weeks ago.
Several millers in Western Kenya have suspended operations due to a biting maize shortage that has pushed up the cost of flour with 5.1 million Kenyans facing starvation.
At least 10 small and large scale milling plants have sent some of their staff on compulsory leave after closing temporarily due to acute maize shortage occasioned by a decline in supply.
“More sackings are imminent as the supply deteriorates, forcing most millers to suspend operation until they obtain sufficient stocks,” disclosed Mr Maina.
The hardest-hit milling plants are in Bungoma, Busia, Kisumu, Narok, Kajiado, and four others in Central Kenya. They are members of the Grain Mills Owners Association (GMOA) and Grain Belt Millers Association(GBMA).
According to reliable information at the Cereal Millers Association (CMA), five large-scale millers — Mombasa millers, Unga, Pembe, Dolar and Kitui millers — have maize stocks that can last a few months.
The Ministry of Agriculture and millers have admitted challenges sourcing the duty-free maize due to scarcity of the commodity in the global market that has pushed up prices.
Whereas the government wants the imported maize to sell at Sh4,200 per 90Kg bag, millers have set tough conditions including having market forces of supply and demand to determine the prices and payment of Sh2.6 million subsidy arrears last year.
Millers have expressed fears of further rise in maize prices as supply deteriorates.
