Market News

Maize imports from Uganda rise sharply to top Sh1.47bn

High maize prices in Kenya help to raise imports from Uganda. file PHOTO | NMG
High maize prices in Kenya help to raise imports from Uganda. file PHOTO | NMG 

Maize imports from Uganda rose sharply between October and November last year compared with the same period in 2016, as high prices in Kenya following a shortage of the grain helped spur the trade.

Data from the Eastern African Grain Council (EAGC) indicates that cross-border trade between the two countries increased from 1,408 tonnes in the fourth quarter of 2016 to 47,563 tonnes estimated at Sh1.47 billion in the same period last year.

EAGC regional manager for marketing and communication Jacinta Mwau said the price differential and improved production in Uganda helped to raise volumes of grain traded between the two neighbouring states.

“In the 4th quarter of 2017 maize exports increased with Kenya offering better prices in the urban markets of Kisumu and Nairobi,” said Ms Mwau.

“It was worth noting that Kenya was harvesting in the 4th quarter and Uganda was approaching the 2nd season rains harvest and prices were lower in Uganda compared to Kenya,” she added.

Trade between Tanzania and Kenya though declined in the period under review following a ban by the Tanzanian government on exports.

“Cross-border trade from Tanzania to Kenya declined. The ban had an impact on trade as Kenyan and Rwandese traders opted to source for maize stocks elsewhere,” she said. Kenya relies on neighbouring countries to bridge a deficit of 20 million bags of maize every year.

Uganda and Tanzania too faced a serious shortage of grain last year, affecting exports to Kenya as the bulk of the grain from the two countries was restricted to the domestic market.

The government was forced to intervene and inject Sh6 billion into a subsidy programme , which reduced the price of a two-kilo packet of maize flour to Sh90 from Sh153.

Under the programme, the government imported maize at Sh3,600 per 90 kilogramme bag and sold millers at Sh2,300. Millers who benefited from the scheme were then required to sell flour at Sh90 a kilo.

The programme came to an end last December pushing up the price of flour to an average Sh110 as millers reverted to expensive commercial maize.