Price of maize flour rises to a new high

Monday April 18 2011

By GATONYE GATHURA [email protected] AND JACOB NG’ETICH [email protected]

The cost of maizemeal has hit a new high, with a two-kilogramme packet going for between Sh86 and Sh133.

This indicates an average price increase of more than Sh30 in the last three months.

According to the update, the unfolding maize crisis has been brought about by traders and farmers who between them are hoarding more than 20 million bags of the staple food, some produced through public subsidies.

Maize millers predict the cost of maize flour will climb even further and want the government to release some of the stocks it is holding.

Mr Diamond Lalji, the Cereal Millers Association’s chairman, said uncertainty about maize availability had triggered speculation.

But even if the government released its stocks, this is unlikely to make a significant difference because the National Cereals and Produce Board is holding 3,458,491 bags, barely enough to meet a monthly national consumption of 3.5 million bags.

According to Mr Lalji, farmers are not releasing maize despite being offered Sh2,200 for a 90kg bag, which is higher than the Sh1,800 being offered by the cereals board.

However, the latest Ministry of Agriculture food update indicates that Kenya’s maize stocks can feed the country until October, when the next harvests are expected.

“The national maize stocks as at February 28, 2011, stood at 24,812,237 bags, of which NCPB holds 3,167,901 bags, farmers’ stocks are 17,394,703 bags, traders’ stocks are 3,458,491 bags and millers stocks are 791,142 bags,” says the official statement.

The only period when there would be a genuine maize shortage, the ministry says, is in early October before the expected harvest in July to August is available for consumption.

The ministry advises that the private sector be allowed to import three million bags to cover this shortfall.