News
Debate rages on over second grain handler
A lorry loaded with food leaves the Grain Bulk Handlers Ltd at the port of Mombasa as another lorry waits to be loaded. Grain importers have been given 14 days to clear wheat and maize that has stayed for two months at various customs locations. Photo/GIDEON MAUNDU
Posted Monday, January 19 2009 at 18:18
In Summary
- Firm’s monopoly in checking out cereals from port blamed for food shortage
Upon the expiry of the monopoly, more than 10 grain handling companies, mainly millers, expressed interest in the business and have been lobbying to have KPA license a second grain handler.
Some of the companies are Mombasa Maize Millers, Premier Flour Mills, Kenya Bulk Handlers, Pembe Flour Mills, Kitale Industries, Supaflo Flour Mills, Coast Silos and Mini Bakeries.
Bowing to pressure, KPA on September 22 last year, advertised, calling interested parties to submit expression of interest to run a second facility, which was cancelled three days before the two-week deadline. Details later emerged that Grain Bulk Handlers Ltd had moved to court to block KPA from licensing a competitor.
The Parliamentary Public Investment Committee probing the cancellation of the tender, had also opposed the extension of the monopoly before it was reviewed, adding that it did not augur well with the public and the business community.
A July report by KPA had argued that grain handling had increased beyond the original design of the facility and that opening up of a second grain facility would have increased competition and improved efficiency.
However, GBHL says its capacity is underutilised at 48 per cent.
Grain Bulk Handlers controls 80 per cent of the business, way above the 25 per cent limit defined for a monopoly under the KPA act.
Following the tender cancellation, Mr Odinga said that allowing a second grain handler would undermine investor confidence, sentiments that were supported by transport minister Chirau Mwakwere.
“Although the Government was not opposed to the second grain facility at the port, there were a lot of issues that needed to be discussed, hence cancellation,” Mr Mwakwere said, adding that the construction of Lamu port would give those interested in handling grain another chance.
-
Submitted by somoinaaPosted January 20, 2009 07:29 PM
-
Submitted by eayaaj
a better distribution network that will allow the grains to be distributed more quickly around the country is needed. at present, enormous pressure is being put on transporters that cannot keep up with demand trucks. the virtually non existent rail network is a major hinderance to the grain industry in the country. considering the congestion at port and the fact that GBHL is adding a secind line so as to be able to handle two ships at once, do we really need another handler. in hindsight we need to improve out transport network to allow fast and efficient off take.
Posted January 20, 2009 04:22 AM -
Submitted by JOBWAPILI
My issue is with fair and balanced journalistic reporting (standards) or lack thereof, in this report. This same paper reported that the PM only cancelled the tender upon advice by the Transport Ministry and Mwakwere, citing investor confidence, possible location at Lamu and pending capacity evaluation. Nowhere is this reported in this article about such important points in the debate on the 2nd terminal. Must journalists politicise policy issues?
Posted January 19, 2009 11:56 PM
RSS
there are some ugly rumours about Odinga's personal stake in this mess. I do not credit them but am disturbed that not even odinga sees it as his responsibility to furnish us with information that would dispel these rumours altogether. So typically, the kenyan is at the mercy of corrupt networks fighting it out in the Media. Who will save this Nation Kenya?