Maize flour prices surge again after April drop

A customer buys a packet of maize flour at a Nyeri supermarket. FILE PHOTO | NMG 

By GERALD ANDAE

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Summary

• At Sh144 for the two kilogramme packet, the price of maize has effectively risen by about Sh22 from last week’s Sh122 for a packet.
• On Tuesday, all Nakumatt branches in Nairobi did not have a single packet of maize flour while Tuskys had less than a 100 packets in two of its town centre outlets.
• Millers warned on Monday that the price of the commodity would remain high till end of June when they expect maize supply to improve with the arrival of a large portion of the imports from Mexico.

Maize flour retail prices have continued to rise, hitting the Sh144 mark for a two kilogramme packet.

This signals more pain for consumers at the shop even as the government moved in to tame the surge with additional fiscal measures.

At Sh144 for the two kilogramme packet, the price of maize has effectively risen by about Sh22 from last week’s Sh122 for a packet.

The two kilogramme packet of maize flour dropped from a high of Sh153 last month following the release of a million bags of government held maize from the Strategic Food Reserves.

A spot check by the Business Daily on Tuesday revealed that all Nakumatt branches in Nairobi did not have a single packet of maize flour while Tuskys had less than a 100 packets in two of its town centre outlets.

Tuskys managing director Daniel Githua said there had been a sharp decline in supply of maize flour and the retail chain had distributed it to all its branches to meet the needs of customers.

He said the supply of maize flour had fallen by more than half, leaving retailers with only 30 per cent of the required supply every week. Tuskys requires 23,000 bales of flour every week, but the ongoing shortage has seen it receive a paltry 6,000 from suppliers, he said.

Millers warned on Monday that the price of the commodity would remain high till end of June when they expect maize supply to improve with the arrival of a large portion of the imports from Mexico.

The first consignment of Mexican maize, which arrived yesterday, is expected to be priced at between Sh3,500 and Sh4,400 for a 90kg bag, but the millers said the pricing would depend on volumes purchased and timing of the purchase.

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A worsening scarcity of grains has seen millers buy the commodity at between Sh4,300 and Sh4,500 per 90kg bag some millers said even as it emerged that maize from government stores is available at Sh3,000 per bag.

Erratic rainfall in key growing zones saw Kenya’s maize output decline by six million bags and resulting in the current scarcity that has pushed up prices.

Kenya’s reliance on rain fed agriculture as opposed to irrigated farming has been blamed for perennial shortages of basic commodities such as maize and sugarcane causing painful price volatility and starvation in parts of the country.

Last week, President Uhuru Kenyatta said his government would introduce new measures in parliament to curb the rising cost of the basic commodities.

The Treasury was expected to propose subsidies on basic commodities for endorsement by parliament, which resumed sittings on Tuesday.

Economist Ansetze Were, however, said subsidies would only amount to short- term measures that need to be backed by long-term solutions.

“Subsidy is just a short term measure to curb the immediate cost surge, however, a long term solution such as improving on the efficiency of our agriculture are required to permanently address the problem,” she said adding that a supplementary budget to allocate more funds to the subsidy scheme would have to be prepared and passed by parliament.

Under the subsidy scheme, the government could direct manufacturers to sell selected goods at predetermined prices that are lower than the actual market cost, with the state paying the difference.

The cost of milk and sugar have also increased significantly piling pressure on the households that are grappling with high cost of living.

Half litre of the long life milk is selling at Sh70 while the fresh brand is retailing at Sh65 for the same quantity.

A two kilogramme packet of sugar crossed the Sh400 mark this week having risen from Sh290 in January forcing the state to open the imports window.

Kenya imports between 8,000 and 15,000 tonnes of sugar monthly but the directorate has increased the volumes significantly to 100,000 tonnes to be shipped in in the next two and a half months.