Retailers sell subsidised maize flour at Sh119, new data shows
Shop attendants at the flour section of a supermarket in Nairobi. FILE PHOTO | NATION MEDIA GROUP
Kenyans bought maize flour at an average price of Sh119 for the two-kilo packet, a pointer that retailers made huge profits from the subsidy meant to lower the cost of the staple.
Kenya National Bureau of Statistics (KNBS) data reveals that on average retailers sold a packet of flour at above the Sh90 set by the government under the subsidy plan.
Kenya on May 16 announced Sh6 billion in subsidies on maize imports to help lower the cost of flour, which had shot up due to a regional drought and poor planning.
But the subsidised flour has been in short supply, prompting retailers to ration the commodity and sell the staple at above Sh90.
GREEDY RETAILERS
The publication of a Kenya Gazette notice in May criminalising the sale of maize flour above the subsidy price seems not to have dampened greedy retailers keen to cash in on the shortage.
The subsidy cut the price of a 90kg bag of maize to Sh2,300 from more than Sh4,000, allowing the two-kilo packet of flour to be sold for Sh90 from May 17 against the market price of Sh140.
The flour sold from mid-May was milled from the subsidised cheap maize, which arrived in the country on May 9 from Mexico via South Africa.
The Treasury published a notice last Friday giving legal backing for State control of sifted maize flour prices, marking the first time the order was issued under a law passed in 2011 that allows price controls of essential goods.
JAIL TERM
This means that those found selling the two-kilo packet of subsidised maize flour above Sh90 risk a fine of Sh1 million or a five-year jail term.
“A person who contravenes the provisions of this Act commits an offence and is liable on conviction to a fine not exceeding Sh1 million or to imprisonment for a term not exceeding five years or both,” states the law.
President Mwai Kibaki signed the Bill into law in September 2011. The law allows the Treasury secretary to set maximum prices for essential commodities upon consultation with the relevant industry.
