Economy

Farmers support raising of import duty on rice

rice

Farmers planting rice in Mwea. Farmers have supported the increase in import duty on rice. File

Summary

  • Last week, importers of the commodity in Mombasa opposed the hike, claiming traders will be kicked out of business since imported rice will become too expensive.

Farmers have supported the increase in import duty on rice, but want more incentives. The duty change was effected two weeks ago following a notice by the East African Community (EAC) published on June 20 2014.

According to the notice, the duty stands at 35 per cent or $200 (Sh17,200) per metric tonne, whichever is higher. The move raises duty to over 50 per cent.

“We welcome this because it is in the right direction. However, irrigation infrastructure is not elaborate and there should be sustained efforts to ensure that farmers are provided with farm inputs to upscale production,” said Booker Kowuor, Small Scale Cereal Growers Association executive officer.

Last week, importers of the commodity in Mombasa opposed the hike, claiming traders will be kicked out of business since imported rice will become too expensive.

“Importation of rice will only be left to those with bigger capital and there is danger of small traders being edged out of business. Competition will be unfair as duty imposed will be the same regardless of the grade imported,” said a Kenya International Freight and Warehousing Association (Kifwa) officer who spoke on behalf of importers.

However, Ambrose Makokha, finance manager at Lake Basin Development Company, criticised the importers saying they were not mindful of the interest of farmers.

“Local rice farmers have in the recent past suffered severe price declines as a result of cheap imports. Even with the declined prices, the local millers have been unable to buy their paddy given the flooded market,” he said.