Animal feed prices in 3-year high

Animal feed prices have shot up to a three-year high, with manufacturers warning of further increases in the coming weeks, as the effects of a maize shortage in the market continued to bite.

A spot-check by the Business Daily showed that the price of animal feeds had risen by between Sh300 and Sh500, a development that manufacturers attributed to more expensive raw material.

The Association of Kenya Feeds Manufacturers (AKEFEMA) said the current maize shortage in the country had pushed up the cost of raw material to Sh3,200 for a 90-kilo bag from the initial Sh2,200.

By Friday, the retail price of a 70 kilogramme pack of chick mash had shot up to Sh3,600 from Sh3,300 the previous week while growers marsh sold for Sh3,100 from Sh2,800 previously.

Increases were also recorded in the price of standard dairy meal, which was selling at Sh4,500 on Friday, up from Sh4,200 previously.

Tough times

“The prices have shot up significantly and this is just the beginning of the tough times ahead. The price of maize is expected to rise further in the coming weeks, a move that will have negative impact on the cost of animal feeds,” Joseph Karuri, chairperson of the AKEFEMA, said.

“We have been buying maize at Sh2,200 as late as last months, but the scarcity has seen the cost of the produce, which forms 80 percent of the raw material, rise to Sh3,200, this has forced manufacturers to adjust the price of their products to much the increases,” he added.

The association has now petitioned the government to remove duty on imported yellow maize and allow processors to ship in the grain to lessen competition between humans and animals.

In 2017, the government allowed millers to ship in yellow maize from Mexico following the scarcity of white grain that saw the price of flour shoot to a historic high of Sh150 for a two kilo packet.

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

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

Yellow maize permits

The yellow maize permits were issued to three main stream millers and about 17 animal feeds manufacturers.

Over two million bags were imported since the waiver on duty was scrapped by the government in April 2017.

Millers had over the years urged government to allow the importation of duty free yellow maize to be used in manufacturing of animals feeds and spare the white one for human use.

Animal feeds are made from the same white maize that is consumed by humans, creating stiff competition between the two in times of scarcity.

The shortage of the commodity has also impacted negatively on the cost of maize germ, which is normally sold to manufacturers by millers as one of the key ingredients in feeds making.

A kilo of this germ has gone up from Sh18 per kilo to Sh24.

The high cost of animal feeds will increase the cost of production with overall effect expected to be felt by consumers as it will impact on prices of different animal products such as chicken, milk and eggs.

Dairy farmers are already grappling with low cost of milk after processors cut the farm gate price from a high of Sh32 to Sh26 in January.

Findings by Tegemeo Institute of Research indicated that Kenya produces enough maize to feed its population based on estimated per capita consumption but when other uses like seed, feeds manufacturing are considered the supply falls short of demand.