Uganda’s maize lowers flour prices to 6-year low

A farmer holds some maize cobs. In Kenya, two-kilogramme packets of some flour brands are retailing at Ksh86 (Shs3,198), a rate last witnessed in 2012 and is below the withdrawn subsidised price of Ksh90 (Shs3,348). PHOTO BY ERONIE KAMUKAMA

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Uganda’s maize exports and harvest have pulled down Kenya’s grain costs from Shs118,998 for a bag in January to below Shs74,374 offering millers room to cut costs for consumers, Business Daily writes.

Uganda’s maize lowers flour prices to 6-year low

Maize flour prices have dipped to a six-year low on increased supply of cheap grains from Uganda and harvests in western Kenya, easing inflationary pressure.
Two-kilogramme packets of some flour brands are retailing at Shs3,198 (Ksh86), a rate last witnessed in 2012 and is below the withdrawn subsidised price of Shs3,348 (Ksh90).
Uganda’s maize exports and harvest have pulled down grain costs from Shs118,998 (Ksh3,200) a bag in January to below Shs74,374 (Sh2,000), offering millers room to cut costs for consumers.

Prices in Kenya
Kenya has received about five million bags of maize to plug a deficit and curb a rise in flour prices. All brands of maize flour with the exception of Jogoo are now trading at less than Shs3,348 (Ksh90) in the retail outlets, coming as a relief to consumers.

A two kilogramme packet of Kifaru is retailing at Shs3,198 (Ksh86), Jimbi Shs3,123 (Ksh84,) Jogoo Shs334 (Ksh9) and Soko 334 (Ksh88).
All these brands were retailing at a high of Shs4,090 (Ksh110) in April.
The cost of Hostess, which is a premium brand, has also dropped to Shs4,834 (Ksh130) from Shs5,206 (Ksh140) previously.
“There is sufficient maize in the country at the moment and we expect this to stabilise the price of flour,” said the director of crops in the Ministry of Agriculture Johnson Irungu.

The supply of grain has improved following the onset of harvesting of short season crop from some parts of the country.
Kenya’s maize deficit last year increased the cost of the two-kilogramme packet of flour to a high of Shs5,689 (Ksh153).
This prompted the Shs22b (Ksh6 billion) subsidy on maize imports in May last year to help lower the cost of flour, which had risen due to drought and poor planning.
The subsidy lowered the cost of a packet of flour to Shs3,348 (Ksh90) and was withdrawn in December sparking a rally in the cost of the staple to Ksh115 (Shs4,276).

Impact
The reduction will ease pressure on inflation, which rose to 4.35 per cent last month, from 4.25 per cent a month earlier, pushed by a rise in some food prices and petrol costs.
According to Eastern Africa Grain Council, the supply of maize in the market will be sustained to the end of the year as Uganda and Tanzania are now harvesting with Kenya’s main crop expected to hit the market starting October.
Uganda and other neighbouring countries play a key role in bridging local deficit through cross-border trade.
Under the East African Community customs union, goods are supposed to flow freely between member states.