Posted on April, 24, 2023 at 07:32 am
Mombasa-based Grain Industries Limited has cut the price of its maize flour by 24 percent, setting the stage for stiff competition with other millers.
The price cut, which is owned by billionaire Mohamed Jaffer, has lowered the price of maize flour by at least Sh52 to Sh166 for a two-kilogramme packet, despite the prevailing high cost of maize which accounts for 80 percent of the total cost of production.
Read: Maize prices increase to historic Sh6,000 a bag
The move by the miller, the producer of Ajab and Umi brands, comes days after President William Ruto announced the cost of flour will drop imminently on increased availability.
Other brands such as Jogoo, Dolla, Soko and Kifaru are selling at an average of Sh210 for a two-kilogramme packet.
In a notice to retailers last Monday, the miller advised them to lower the cost of flour in line with the recommended price that they had issued.
“Kindly implement the recommended price on shelves,” reads a notice by the miller.
This is the first time in nearly three years that the price of the staple has dropped to these levels. The country has witnessed a high cost of flour since 2018 on the back of a shortage of maize in the market.
Millers however argue that selling flour below Sh200 per two-kilo packet under the current cost of maize is not viable.
“It is impractical to sell flour at below Sh200 given the current cost of maize in the market,” said a member of the Cereal Millers Association.
Kenya has been pegging its hopes on imports to cut the cost of flour, but traders have failed to bring in enough stocks to lower the runaway prices.
Read: Prices of maize jump on high demand, importation delays
As of last week, only two ships had docked in Mombasa, carrying a total of 100,000 tonnes of maize, out of the 10 million bags of maize that the State authorised millers to ship in duty-free.
Source: Business Daily