Posted on April, 18, 2016 at 10:12 am
Kenyan farmers have stepped up export of maize encouraged by record prices in Tanzania, worsening the cereal shortage locally that has seen flour prices begin to rise.
Latest market data indicates that 145 tonnes of maize have been shipped to Tanzania through Isebania border in the last 30 days alone as farmers seek better prices in the regional market.
Data prepared by the Regional Agricultural Trade Intelligence Network (Ratin) shows that a 90-kg bag of maize currently retails at Sh4,898 in Dar es Salaam, the highest unit price in East Africa.
The same quantity of maize currently fetches between Sh2, 500 to Sh3, 510 in Nairobi, an average of Sh2,661 in Kampala and Sh4,597 in Burundi.
The Ratin report shows that the majority of Kenyan farmers are opting to ferry their produce all the way to Dar es Salaam in search of higher returns.
This comes just one day after Kenya millers warned that the price of maize flour would increase in coming weeks following a grain shortage, putting pressure on households that depend on the cereal as a major source of food.
“The supplies of maize have been tight in the market and millers are unable to get enough stocks, this situation would see the price of flour go up in the coming weeks,” an official of the Cereal Millers Association told the Business Daily in a previous interview.
The two-kilogramme packet of maize flour has increased by an average of Sh5 over the past two months on high maize costs. Flour prices have been falling since last September.
Maize prices have a big effect on inflation in Kenya’s economy where it is the staple food and accounts for a significant share of poor households’ budget.
Inflation stood at 5.45 per cent last month, down from 6. 78 per cent in February and has been falling since the start of the year.
The government estimates that farmers held at least 16 million bags of maize by the end of December, a stock that would last up to early this month.
Out of that stock, farmers were holding about 7,850,200 bags, traders 2,774,948 bags, millers 6,590,200 bags and National Cereals and Produce Board had 3,795,000 bags.
Millers say they have since mopped up their stock but supply from farmers has not been forthcoming.
Even as its farmers export to Tanzania, Kenya has been banking on supply from regional markets to plug its annual deficit of 20 million bags of maize.
According to the Ratin report, cheap Ugandan maize that has been arriving into Kenya in recent months has so far helped to stabilise market prices.
In the last 30 days 5.58 tonnes of Ugandan maize has been shipped in through Malaba with 2.5 tonnes more coming in through Lwakhakha border points. Another 0.6 tonnes of Ugandan maize was allowed into Kenya through Busia border post.
Source: http://www.ippmedia.com