Maize flour prices have dropped below Sh90 per two-kilogramme packet on increased supply of maize as farmers who missed out on selling their harvest to the government release the grain to the market.
The influx of grain in the market has subdued buying price of a 90-kilogramme bag from a high of Sh2,100 last month to Sh1,800 currently.
This has slashed cost of maize flour with a two-kilogramme packet of the commodity selling at between Sh85 and Sh86 in all the major supermarkets, down from an average of Sh95 in December.
The government vetted a handful of farmers to supply two million bags of maize to the National Cereals and Produce Board (NCPB), out of the total 40 million that were harvested in the last season.
“Farmers who did not make it to NCPB have rushed to release their stocks hence flooding the market, this has resulted to a decline of both the flour and maize prices,” said United Grain Millers Association chairperson Peter Kuguru Monday.
A two-kilo packet of Jogoo is now retailing at Sh87, Pembe Sh85, Soko Sh85 and Kifaru Sh85 with the premium brand, Hostess, now retailing at Sh123 from a high of Sh137 previously.
The Cereal Millers Association also attributed the falling prices on high supply of maize in the market.
NCPB capped the purchase of maize at 400 bags per farmer. This has seen a lot of farmers left with more grain and had to look for an alternative market.
In December last year farmers were hoarding their crop in anticipation that the government would buy more grain from them at a good price, creating fears that the price of flour could rise on scarcity of the raw material.
The Kenya National Bureau of Statistics last month said that reduced costs of most food items such as maize grains and flour helped to ease inflation in January to a five-month low. The Kenyan staple is a main driver of inflation.
Inflation dropped to 4.70 per cent in January from 5.71 per cent a month earlier, offering relief to consumers who have been grappling with high costs of living.