Agriculture secretary Willy Bett and his Treasury counterpart, Henry Rotich, yesterday said millers will start accessing the grain from today at Sh3,000 per bag or Sh1,500 below the prevailing market price of Sh4,500.
Cereal Millers Association chairman Nick Hutchinson said he expects government intervention to generally lower the cost of the staple even as retail prices vary from one miller to another.
Kenya is among the regional countries that secured a grain deal last month with Ethiopia, estimated at Sh5.5 billion, aimed at easing the current maize shortage locally.
Consumers of maize flour are expected to start getting relief at the shops next week when consignments milled out of the one million bags of cheaper maize from the Strategic Food Reserve (SFR) hit the market.
Agriculture secretary Willy Bett and his Treasury counterpart, Henry Rotich, yesterday said millers will start accessing the grain from today at Sh3,000 per bag or Sh1,500 below the prevailing market price of Sh4,500.
“Release of stocks from SFR is just a short-term intervention measure that should see retail prices drop to Sh115 in the next one week,” said Mr Bett. The price of a 2 kg packet of maize flour rose from about Sh90 a year ago to Sh153 this week, adding impetus to inflation that now stands at 10.28 compared with 9.04 in February. Mr Bett said the release of strategic reserve maize was a short-term measure aimed at arresting the surge in retail prices as the country awaits the arrival of imports from Mexico. The consignment from Mexico is expected to arrive in the next 30 days.
Kenya consumes about three million bags of maize every month, meaning the one million 90kg bags are enough to feed Kenyans for one week.
Mr Rotich said zerorating of duty on inputs in flour processing took effect yesterday and is expected to lower the price per packet of flour by Sh5.
“The zerorating of VAT on transport, electricity and packaging material is now effective and has to reflect in the price of flour,” said Mr Rotich.
Last week, Treasury zerorated duty on wheat and maize flour and waived import duty on imported maize to lower the rising cost of maize flour, which is country’s staple.
Cereal Millers Association chairman Nick Hutchinson said he expects government intervention to generally lower the cost of the staple even as retail prices vary from one miller to another depending on the time that it will take them to access government stocks.
“This move will have an impact on the cost of flour, but the price might differ from one miller to another depending on the time one will take to access maize from National Cereals and Produce Board (NCPB),” said Mr Hutchinson.
Though Mr Bett said the maize will sell at Sh3,000, Mr Hutchinson noted that it can only get to Nairobi at Sh250 more given the transport cost from NCPB depots that are mainly located in western Kenya.
Kenya is also expecting maize from Ethiopia, which the ministry of agriculture says it will arrive at Sh4,300 per bag.
Kenya is among the regional countries that secured a grain deal last month with Ethiopia, estimated at Sh5.5 billion, aimed at easing the current maize shortage locally.
The deal, which was facilitated by Eastern Africa Grain Council (EAGC) and USAid’s East Africa Trade and Investment allows Kenyan traders to import maize and pulses from Ethiopia after signing 51 contracts amounting to 275,000 tonnes.
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