Kenya stares at food crisis as maize reserves drop

What you need to know:

The country currently faces a shortage of 720,000, 90-kilogramme bags that will be covered by purchases from the East Africa region and the release of 500,000 bags from the national reserve.
Production of maize dropped after the country was hit by unseasonably dry weather during the March-to-May rainy season.
Kenya consumes 3.72 million bags of maize a month.

Kenya’s strategic maize reserves held at the National Cereals and Produce Board (NCPB) has dropped to half of the optimum level of five million bags, underlining the food crisis facing Kenya.

NCPB on Wednesday said it’s holding 2.5 million bags, adding that delayed settlement of Sh5.9 billion owed to it by the government has made it difficult to buy maize from farmers this year.

This comes in a period when the government plans to tap the reserves to plug a deficit, further weakening the hand of NCPB in the push to make Kenya a food secure country.

The NCPB managing director Newton Terer said delays by the government to settle the debt hampered its quest to increase its strategic grain reserves above the five million bags mark.

“We are experiencing cash flow challenges and payment of the debt will enable us to mop up maize from farmers,” said Mr Terer in Eldoret on Wednesday.

The country currently faces a shortage of 720,000, 90-kilogramme bags that will be covered by purchases from the East Africa region and the release of 500,000 bags from the national reserve, Principal Secretary Sicily Kariuki said last week.

READ: Failed rains to cut maize output 20pc
Millers have raised the cost of flour by five per cent to an average of Sh120 for a two-kg packet following the grain shortage, which has increased the cost of a bag of maize Sh3,600 up from Sh3,200 in April.

Production of maize dropped after the country was hit by unseasonably dry weather during the March-to-May rainy season.

“The situation may get worse as farmers continue to reduce acreage this season as costs of farm inputs rise,” Standard Bank Plc said June 3 in a research note.

Maize production in the North Rift, the country’s food basket, is expected to decline by 20 per cent this season due to erratic low rainfall during plating season that led to poor germination.

Kenya’s annual inflation rate increased to 7.3 per cent in May, close to the upper limit of the government’s target of 2.5 per cent to 7.5 per cent.

The cost of food, which carries a weighting of 36 per cent in the consumer-price basket, rose 8.9 per cent, according to Kenya National Bureau of Statistics.

The country requires three million bags of maize in the next two months and hopes to import from neighbouring countries. Kenya consumes 3.72 million bags of maize a month.

Corn imports to Kenya from outside the East African Community common market, which also includes Tanzania, Uganda, Rwanda and Burundi, are subject to a “steep” 50 per cent duty. The tariff can be lowered in a scenario of food insecurity.