The Sh90-a-packet subsidised maize flour has been extended to the end of the year after the government agreed to release more grains to millers, cushioning consumers from a sharp rise in the staple food.
Agriculture Cabinet secretary Willy Bett said Tuesday the subsidy, which was to end last month had been extended.
He said millers had been given access about 1.7 million bags of subsidised maize.
“We’ve agreed that the subsidy programme will officially come to an end on December 31,” said Mr Bett.
The minister said the decision to extend the subsidy was informed by the fact that the prices of flour would have shot up to levels beyond the current low of Sh90 for a two-kilo packet should the programme have been terminated.
The ministry says grains from the farms have hardly been coming to the market due to ongoing rains that have coincided with the harvesting of the main crop in Kenya’s breadbasket of the North Rift.
“By now we should be at the peak of purchasing maize from farmers but the ongoing rains have affected the purchase of the produce from growers,” he said.
National Cereals and Produce Board, which hosts the food reserve, has so far bought 284,000 bags of maize from farmers against a target of 2.4 million.
Millers were expecting to buy maize at an average market cost of Sh3,400 a 90-kg bag, forcing them to increase flour prices to Sh120 per two-kilo packet.
This looks to put pressure on inflation, which fell to 5.72 per cent last month, from 7.06 per cent in September, pushed by a fall in some food prices.