Lorries deliver maize at the Kenya National Cereals and Produce Board depot in Eldoret. FILE PHOTO | NATION
Export of maize from the region in the last quarter dropped by 16 per cent because of a decline in supplies from Uganda.
According to the latest cross-border trade data, Kenya was the main destination for maize exported from Uganda and Tanzania.
Uganda
exported a total of 59,545 tonnes of maize to Kenya between March and
June down from the 87,282 tonnes exported between January and March.
Tanzania exported 49,421 tonnes to Kenya in the second quarter, down from 76,723 tonnes in the previous period.
“Maize prices in Kenya were still attracting supplies from Uganda and Tanzania even though they were lower than in the first quarter,” states the East Africa Cross-border Trade Bulletin.
“Maize prices in Kenya were still attracting supplies from Uganda and Tanzania even though they were lower than in the first quarter,” states the East Africa Cross-border Trade Bulletin.
The
drop in trade volumes has also been attributed to modest carryover
stocks from past year in some countries, increased harvest and currency
depreciation.
Increased demand
Volumes of sorghum traded in the region for the past three
months also dropped because of increased local demand in Uganda, the
main producing country. However, refugees from South Sudan and breweries
increased demand for the product.
South Sudan, Kenya, Rwanda and Eritrea are the main consumers of sorghum from Uganda.
Trade
in rice — both locally produced grain and re-exports from Somalia —
increased in the second quarter 2018 increased, attributed to large
stocks and relatively lower prices due to lower prices of its substitute
maize flour.
Somalia exports its rice to Kenya and Ethiopia whereas Tanzania is the main exporter of rice to mostly Kenya and Rwanda.
Rice
exported to Kenya from Tanzania increased from 22,792 tonnes to 23,269
tonnes and to Rwanda increased from 13,738 tonnes to 19,341 tonnes
during the period.
Imports from Asia
“The
absence of punitive tariffs by other East Africa Community countries
due to reduction in mixing of locally produced Tanzanian rice with
imports from Asia to circumvent the East Africa Community Common
External Tariff while re-exporting the Asian rice was a factor,” states
the bulletin provided by Eastern Africa Grain Council.
“Attractive
prices in some markets in Kenya, Uganda and Rwanda where the Tanzanian
rice is preferred because of its aroma and high water absorption that
makes it swell, also led to the rise in volumes traded,” added the
bulletin.
Favourable rainfall
The
cross-border data analysis predicts that maize production in Kenya will
to hit a five-year high due to favourable rainfall, especially in maize
producing areas in Rift Valley and some southwestern and eastern
agricultural areas.
“The gap, which is usually filled
from regional imports, is expected to be slightly lower than in the
2016/2017 marketing period,” states the report.
Maize prices are expected to decline in Kenya and Rwanda compared to with the same period last year due to better production.
Currently, Uganda is in middle of its maize harvest of the year which is expected to keep prices lower.
The
analysis reveals that maize prices are expected to fluctuate between
$280 and $300 a tonne are Kenya from August to March next year.
In
Uganda, the price will drop from $120 a tonne in August to $100 in
January. Maize price in Rwanda is expected to plateau at $250 a tonne.
“Maize
exports from Ethiopia to Kenya are likely to be subdued due to better
production in Kenya, and stiff competition from Ugandan and Tanzanian
supplies, whose production areas are relatively closer to the main
consumption markets in Kenya, or have comparatively cheaper transport
costs,” states the bulletin.
Maize prices are highest
in Juba and are expected to go as high as $550 a tonne, mainly due to
high transport costs that are attributed to to high fuel prices.
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