Maize flour prices in Uganda fall due to increased supply of cheap grains

UGANDA – 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.

According to Business Daily, the imports from Uganda and harvest has pulled down grain costs from Sh3, 200 a bag in January to below Sh2, 000, offering millers room to cut costs for consumers.

Kenya has received about 5 million bags of maize to plug a deficit and curb a rise in flour prices, to which all brands of maize flour with the exception of Jogoo are now trading at less than Sh90 in the retail outlets, coming as a relief to consumers.

Two-kilogramme packets of some flour brands are retailing at Sh86, a rate last witnessed in 2012 and is below the withdrawn subsidized price of Sh90.

A two kilo packet of Kifaru is retailing at Sh86, Jimbi Sh84, Jogoo Sh9 and Soko Sh88. All these brands were retailing at a high of Sh110 April.

The cost of Hostess, which is a premium brand, has also dropped to Sh130 from Sh140 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.

Maize deficit last year increased the cost of the two-kilogramme packet of flour to a high of Sh153.

This prompted the Sh6 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The subsidy lowered the cost of a packet of flour to Sh90 and was withdrawn in December sparking a rally in the cost of the staple to Sh115.

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.

The 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.

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