More consumer pain as cost of flour rebounds to Sh130 a pack

Monday March 20 2017

A van ferries maize to the market on March 20, 2017. A 90-kilogramme bag of the staple is selling at Sh3,850. PHOTO | JARED NYATAYA

A van ferries maize to the market on March 20, 2017. A 90-kilogramme bag of the staple is selling at Sh3,850. PHOTO | JARED NYATAYA 

By GERALD ANDAE
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The consumer price of flour has rebounded to Sh130 for a two-kilogramme packet after easing last month as food cost threatens to take inflation to a new short-term high.

This comes as millers warn that the price will continue to rise in the coming days as maize supply in the market gets tighter.

Inflation in January jumped to 9.04 per cent, partly egged on by the rising food and water-related costs as a nationwide drought persists.

Common brands such as Jogoo is selling at Sh130 from Sh126 for a two-kilogramme packet last week, Ndovu Sh130 from Sh123, Soko Sh131 from Sh123 and Kifaru is retailing at Sh129 from Sh123.

“The situation is getting worse as we are not getting frequent supplies of maize with whatever produce that we get being milled immediately,” says Cereal Millers Association vice-chairman Mohamed Islam.

Last month, the price of flour dropped from an average of Sh128 for a two-kilogramme packet to Sh123, with millers saying that they were benchmarking the drop with Jamii Unga, which had cut its price, forcing major players to follow suit in order to retain their markets.

Mr Joshua Chepkwony, the owner of Jamii Unga confirmed to the Daily Nation that his firm had lowered the price per bale, but could not provide the figures.

“It is true we lowered our price because we are considerate of our customers. What we are doing is to ensure that we make margins that are reasonable and that will not subject buyers to higher prices,” said Mr Chepkwony who also owns fibre firm Jamii Telecoms.

A recent food status report from the Ministry of Agriculture indicates Kenya will have a maize flour deficit of two months between June and July as the available stocks run out.

The food balance sheet report, which gives the status of available food in the country, indicates that Kenya had 15 million bags of maize as at January 31.

The report notes that from the current food stocks, the country has a shortfall of 7.5 million bags, which has seen the price of the staple increase by 32 per cent on average compared to the same period last year.

The depressed long rains performance resulted in realisation of 32.8 million bags of maize against an expected production of 38 million bags.