The price of maize floor has rise sharply, even as the country grapples with low-priced maize from last season’s harvest.
The two-kilogramme packet of maize flour has shot up to Ksh100, up from Ksh85. This is an irony that the government is hardpressed to explain.The 90kg bag of maize is going for Ksh2,000. Millers say the price escalation is mainly linked to massive hoarding of maize by the middlemen who buy the produce from farmers and supply the factories, Business Daily reports.
The hoarding of maize is linked to a recent restriction of imports from neighbouring countries such as Tanzania that has created speculation of a looming supply shortage, prompting traders to hold back their stocks.
“Market speculation has imposed heavy hoarding upon the market, resulting in an artificial supply shortage that has pushed up prices by 27 per cent since last year,” said Nick Hutchinson, the chairman of the Cereal Millers Association (CMA).
Millers say the high cost of raw materials has pushed up the ex-factory price of flour from the range of Ksh84 to Ksh87 in February to a high of between Ksh95 and Ksh100 this month, a 13% increase. “Maize prices at the factory gates have increased from an average of Ksh2,200 in February to Ksh3,000 currently, prompting an increase in the price of flour,” Mr Hutchinson said.
A 2kg packet of Soko maize flour is now retailing at Ksh104 from Ksh86 in November, Pembe at Ksh105 from Ksh92 while Jogoo is selling at Ksh97 from Ksh86 in the major retail shops.
Agriculture principal secretary Sicily Kariuki dismissed the claims by the millers that there is a supply shortage in the maize market.
Mrs Kariuki attributed the rise in maize flour prices at a time when the country is awash with newly harvested produce to dishonesty among millers. “There is no justification whatsoever for the prices of maize flour to go up at this point in time. Millers have not asked us to release stocks held in the National Cereals and Produce Board (NCPB) stores to smoothen out the pricing,” Ms Kariuki told Business Daily.
The PS said the State was under obligation to act in the event of a severe shortage in the supply of the staple food by releasing the NCPB stocks held as Strategic Grain Reserves (SGR). Ms Kariuki said it was too early for retail prices to start rising and urged the millers to revert to a reasonable pricing regime.
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