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The Government has released two million bags of maize to millers to plug the grain shortage that has seen the price of flour rise 30 percent in one month as millers appeared to have succeeded in pushing state to offer subsidies to lower the cost of flour.
Currently, the price of a 90 kilogramme bag of maize has gone up to Sh3 400 and is forecast to hit the Shs 5000 mark as farmers demand higher compensation owing to a rise in the cost of production of the commodity.
Ministry of Agriculture officials say maize from the Strategic Food Reserve (SFR) will be sold to traders, miller sand schools at Sh2, 300 each to curb the rising cost of flour but as a stop gap measure pending planned duty free maize imports of both yellow and white maize from July. Strategies in place include waving of a 50 percent duty imposed on imported grain from outside East Africa Community (EAC) region, to avoid a last minute rush
While the government has cited hoarding of maize after a bumper harvest last year, farmers through their umbrella body Cereals Growers Association are demanding better prices for their bumper crop in 2018 . Chairman Furries Kruger has vehemently, rejected the Government’s attempts to suppress local production.
However , Agriculture Principal secretary Hamadi Boga says they have failed to attract sufficient stocks to rebuild the Strategic Grain Reserves after farmers rejected the Government’s offer price of Sh2 300 per 90 kilogramme bag.
” If millers do not get the grain they shut down and jobs are lost and farmers are claiming they have. We want to see the flow of maize. Shs2, 500 a bag is not bad,” said the PS on telephone.
Millers, through their umbrella body, United Grains Association, welcomed the Government’s move saying it will depress the current escalation in unga prices but farmers lamented, insisting that the raft of interventions as favourable to only consumers only.
“ While we expect the prices to drop from the current Sh130 per two kilogramme packet, the cost of fuel has also gone up. Consumers can expect a slight relief,” said Peter Kuguru, chairman for the millers’ lobby.
A spot check in Nairobi shows that a two kilogramme packet costs up to Sh147, up from Sh122 previously. Kuguru says previous lower per packet consumer price was based on continuous supply of grain from Government-owned NCPB stores to the processors at a pre agreed price of Shs1, 600 per 90 kilogramme bag.
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