Flour price set to rise higher, millers warn

Maize flour section in a Supermarket
Maize flour section in a Supermarket. FILE PHOTO | NMG 

Millers Thursday warned of further maize flour price increases as the government said it was planning to release stocks of the produce in the market in coming days to check the rising cost of the staple.

Millers said the shortage of maize was getting worse with a 90-kilogramme (kg) bag having risen by 39 percent to Sh3,200 over the past two weeks.

They said Kenya faces market conditions last witnessed in 2017 when the price of a 2kg packet of maize flour jumped by a third to Sh135.87 over one year.

Unga Limited has raised maize prices by Sh19 a packet to Sh110 over the past week, a move that will raise pressure on inflation and hurt household budgets.

The government has cited hoarding of maize for the price jump, arguing the country has enough grains after a bumper harvest last year.


“The situation is getting bad and we expect the current high cost of maize to push further the price of flour in the next few days,” said a miller who sought anonymity.

According to the processor, the current retail price does not reflect the prevailing cost of maize, implying that higher prices are expected once the new costs are factored in.

Agriculture Cabinet Secretary (CS) Mwangi Kiunjuri said the government will release stocks from the National Cereals and Produce Board (NCPB) in the coming days as it monitors the situation to come up with a quick intervention measure to curb a further rise.

Addressing a news conference in Nairobi, the CS said the country has 21 million bags of maize despite a tight supply in the market that has seen price of a two kilo packet of flour hit Sh119.

“We are currently monitoring the situation and we shall be releasing stocks from Strategic Food Reserve (SFR) to stabilise the price of flour,” said Mr Kiunjuri.

Sources at the SFR told the Business Daily that ministry has already had discussions with the agency and that it will be releasing about two million bags of maize in the next one month at Sh2,500 per 90kg bag.

“We have had discussions with the ministry and agreed that we should release two million bags of maize to the market in about a month’s time,” said a senior official at SFR who sought anonymity for fear of contradicting the CS.

|The NCPB has been buying maize from farmers in a process that has attracted few sellers with only 420,000 bags bought to date against the required two million.

Mr Kiunjuri said NCPB is currently in possession of 4.3 million bags, which are sufficient to last the country for at least a month.

Of the 21 million bags of maize available in the country, it is estimated that stock held at household level is 13 million bags, representing 61 percent of the total produce.