In tough economy, cheap flour good for consumers, bad news for farmers

Workers arrange maize flour at a supermarket in Nairobi. FILE PHOTO | NMG 

By BARNABAS BII

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Summary

• Cabinet Secretary for Agriculture Mwangi Kiunjuri on Wednesday directed millers and traders to sell a two-kilogramme packet of flour at Sh75 to protect consumers against exploitation.
• Agriculture experts and maize farmers in the North Rift region, the country’s food basket, said fixing of maize flour prices will destabilise the local market resulting in a decline in farm gate prices thus subjecting farmers to losses.

The government’s plan to reintroduce cheaper maize flour is good news for Kenyans who are grappling with the high cost of living but a threat to farmers who are faced with market challenges for the produce.

Cabinet Secretary for Agriculture Mwangi Kiunjuri on Wednesday directed millers and traders to sell a two-kilogramme packet of flour at Sh75 to protect consumers against exploitation.

Agriculture experts and maize farmers in the North Rift region, the country’s food basket, Saturday said fixing of maize flour prices will destabilise the local market resulting in a decline in farm gate prices thus subjecting farmers to losses.

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Many farmers in the North and South Rift regions complained that the cheaper flour will hurt the already fragile local market considering the anticipated bumper harvest this season.

“The market forces of supply and demand should be left to determine the maize flour prices. Fixing prices for the commodity will complicate matters further for farmers who are faced with market challenges for the produce,” said Mr James Maina, an Eldoret based land economist.

Maize farmers in Uasin Gishu County are holding over 500,000 bags of last season’s crop while the production is projected to increase from four million to 4.2 million bags this season.

According to Director of Crops in the Ministry of Agriculture, Dr Johnstone Irungu, maize yield is projected to rise from 37 million to 40.9 million of 90kg bags, complicating market issues for farmers.

“The production is projected to increase this season due to favourable weather conditions during planting, availability of subsidised farm inputs and disease outbreaks control,” explained Dr Irungu.

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Interviewed farmers said increased fuel prices, introduction of 16 per cent VAT on imported agro-chemicals and disease outbreaks coupled with unsteady market prices was rendering agriculture an unprofitable investment.

It costs a farmer Sh4,500 to plough an acre of land with the production of a 90kg bag of maize being estimated at Sh1,700, making it the highest in the East African region.

“Maize has remained our traditional source of food and income and it will be difficult to sustain the production owing to the increased production costs against the deteriorating produce prices,” said Ms Alice Chesang from Chepkumia in Nandi County.

This come as maize prices have plummeted to as low as Sh1,200 per 90kg bag in most parts of the North Rift region and the prices are likely to drop further due to the ongoing harvest season.

A two-kilogramme packet of maize flour goes for between Sh80 and Sh100 in most retail outlets in the North rift region.

But most consumers have been opting for posho mill flour which they consider cheaper as opposed to buying from the millers.

The government, through the National Cereals and Produce Board, offered Sh3,200 per bag for Strategic Grains Reserve before it suspended buying early this year. Maize farmers are demanding an outstanding Sh3.5 billion for the produce the board bought last season.