The prices of maize have shot up sharply on the back of delays in importation and competition for limited supply between millers and the humanitarian agencies for the little available stocks.
The price of a 90-kilo bag of maize has increased to Sh5,000 after it had dropped to a low of Sh4,400 last week as farmers rushed to sell their produce ahead of imports that were meant to start on Monday.
The prices have also spiralled on stiff competition between millers and the World Food Programme, which is buying the produce at Sh5,100 for a 90-kilo bag.
WFP has contracted the National Cereals and Produce Board to buy them maize meant for humanitarian assistance and it has offered a price higher than what is prevailing in the market.
“We are now competing for the little that is in the market, this, coupled with failure to effect imports has seen the cost of maize go up,” said Ken Nyagah, chairman United Millers Association.
Processors now argue that it is a matter of days before the cost of flour, which had dropped to an average of Sh180 for a two-kilo packet currently, goes back to Sh200.
“The price of maize has gone up by the largest margin within a span of a few days and it is just a matter of time before we see the cost of flour go up again to retail above Sh200,” said Atin Aggarwal, chief executive officer Trident Millers.
The Ministry of Agriculture is yet to gazette the name of millers and traders who will be allowed to ship in maize in the country as the window for duty-free imports opened on Monday.
The government in December announced that it would allow the importation of 10 million bags of maize to curb the shortage that has seen the cost of flour remain high in the market on the back of the high cost of the grain.
The State will allow traders to ship in the commodity outside the regional market duty-free between February and August this year, just two months before the onset of the main harvest in October.
The government says the import will cover the existing deficit and will cut down on the cost of flour on the shelves.
