What you need to know:
- Exports. Uganda currently exports majority of its maize to South Sudan. However, Kenya has indicated that it is engaging authorities in government to increase what it exports to its largest trade partner to deal with a shortage.
The Grain Council of Uganda has asked government to immediately ban the export of ungraded maize, given the number of challenges that it presents.
Speaking in an interview yesterday, Mr Henry Musisi, the Grain Council of Uganda acting executive director, told Daily Monitor that in a meeting, which they had held with Ministry of Financial officials on Tuesday, they had asked government to ban export of ungraded maize, whose trading has increased due to demand pressures across the East African region.
The export of ungraded maize, he said, presents a number of challenges, which include distortion of quality and pricing and stifling growth of Uganda’s grain processing sector.
“We don’t want to lockout anyone from the market including our neighbours but they should take maize that meets the EAC standards,” he said.
Export of ungraded maize, Mr Musisi said, has been recorded across all border posts leading to Kenya, South Sudan and other East African countries.
“East African countries have ratified and agreed on a set of minimum standards on all grains. It is only grain that is clean and dried to agreed moisture levels that should be graded, packed in standard bags and … allowed to be exported,” Mr Musisi said, noting that traders from Kenya and Rwanda want to buy maize from the farms because they want to distort prices.
Mr David Ebiru, the Uganda National Bureau of Standards executive director who also attended the Tuesday meeting , told Daily Monitor that they were aware that Kenyan traders are going up to the farms, from where they pick ungraded maize.
“We agreed with an action plan to formalise trade in grain, especially maize and all other cereals,” he said, noting another meeting has been set in about two weeks on August 2 to review the action plan to see what measures should be adapted to organise traders in the grain sector.
Countries in East Africa are competing for a limited stock of white maize amid constrained supply resulting from poor harvests.
Maize is an important ingredient in the manufacture of white floor, which is one of the largest food items in East Africa, and production of animal feeds.
Mr Musisi also noted that whereas Uganda has the capacity to process and store all the maize it produces, some dealers choose to sell the commodity on the farm, which has in effect stifled growth of processing facilities, whose installed capacity stands at more than 10,000 tonnes per day.
Currently, he said, processers are operating at a capacity of between 30 and 40 percent yet unprocessed maize is exported at low rates with very little or no value addition.
“The market has been eroded by open purchase of maize when it is still on the farm,” he said, noting that this affects quality and development of related industries such as maize millers and processors.
Uganda currently exports the largest share of its maize to South Sudan.
However, Kenya has indicated it is talking to government officials to increase the share of what Uganda exports to the country as it seeks to resolve a shortage resulting from poor harvests.
The U-turn is a shift from a difficult trading relationship in which Kenya has previously blocked Uganda’s maize from its market on claims that it contains high levels of aflatoxins.
The blockades had in the process forced Ugandan traders to seek alternative markets, among which include South Sudan, which currently is taking the largest share of Uganda’s maize exports.