Commodities

Import tax relief delay keeps feed prices high

feeds

David Rotich feeds his cows in Kapsosio, Moiben. PHOTO | JARED NYATAYA | NMG

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Summary

  • The price of a 70-kilogramme bag of dairy meal has gone up from Sh2,500 in August last year to Sh3,400 currently.
  • Kenya relies on imports of sunflower seed cake from Tanzania while soya is imported from Uganda, Malawi and Zambia to satisfy the raw materials needs of the industry.

The Treasury is yet to waive duty on yellow maize a month after President Uhuru Kenyatta issued a directive on emergency measures to lower the cost of animal feeds, exposing Kenyans to costly food as farmers pass on the cost to the consumer.

The President issued his directive on October 20 to the Agriculture Ministry and the Treasury to come up with intervention measures within seven days from the date, to address the rising cost of feed that has now hit a historic high.

The Agriculture ministry prepared the intervention measures, which included a duty waiver on the importation of yellow maize, but the Treasury is yet to approve the proposal.

Stakeholders in the sector argue that the delay in approving the relief measures is having a negative impact on both the farmers and manufacturers, who are struggling to control costs.

“Prices are still high and processors are now operating at 50 percent of their installed capacity because of a lack of demand for feeds from farmers due to the high cost of the products,” said Joseph Karuri, chairman of the Association of Kenya Feed Manufacturers.

The price of a 70-kilogramme bag of dairy meal has gone up from Sh2,500 in August last year to Sh3,400 currently, chick marsh retails at Sh4,200 from Sh3,250 while layers marsh now sells at Sh3,800 from Sh3,100.

Treasury Cabinet secretary Ukur Yatani did not respond to the Business Daily Inquiry on when he would approve the intervention measures.

The Ministry of Agriculture has also proposed exemption of duty to other key raw materials such as sunflower and cottonseed cakes that are normally imported to the country.

Seed cake

“We drafted the framework on interventions to be taken, mainly on exemption of duty for raw materials, and is now with the Treasury,” said Livestock PS Harry Kimtai.

Kenya relies on imports of sunflower seed cake from Tanzania while soya is imported from Uganda, Malawi and Zambia to satisfy the raw materials needs of the industry.

The Zambia government dealt the feeds industry a blow with the suspension of exports of soya bean meal and sunflower seed cake almost three months ago. The price of soya has so far moved up from Sh65 a kilo last year to Sh130 currently.

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