KENYA – Wheat flour millers have warned of a further rise in the cost of the commodity and its products such as bread in the coming months on diminishing domestic stocks amid an import crunch, Daily Nation has reported.
Millers blame the Agriculture and Food Authority for delaying approving imports after the regulator maintains that millers have to first mop up the domestic stock to cushion local producers.
“There has been a delay in approvals of wheat imports by the Agriculture Food Authority (AFA) because they claim that millers have not mopped up the local wheat produce as per their quota, which is not the case,” said one of the wheat millers.
The uproar comes after the recent declaration by the Ministry of Agriculture that the country is expecting a bumper harvest, prompting the National Cereals and Produce Board (NCPB) to offer storage facilities.
According to Agriculture Food Authority, the country consumes about 2.4 million bags but with only 100,000 metric tonnes produced, the country has to import close to 2 million metric tonnes annually from Russia and Ukraine.
However, Cereal Growers Association CEO, Antony Kioko said that production of wheat this year is projected at between 600,000-700,000 bags in Narok County.
Under the Kenya Local Wheat Programme, Cereal Growers Association provides the estimated volumes of the grain held by farmers to the Agriculture Ministry, AFA, Treasury, and millers at the beginning of each season.
The millers, however, claim that Kenya has produced only 200,000 bags that are being bought by millers in Narok adding that if the matter is not resolved promptly, prices for wheat-based products are expected to rise.
“Any costs incurred through demurrage, unentered [fee charged Grain Bulk Handlers Ltd for lack of clearance papers], and storage will ultimately affect consumer prices.
The news adds more pain to Kenyans who are already battling the high cost of food products amid a shrinking economy after the recent increase in the price of bread by 16 percent.
A spot-check on select retail stores in Nairobi showed a two-kilogram packet of whole wheat flour is retailing at between Sh189 and Sh212, having increased from an average of Sh165.89 in May as per the Kenya National Bureau of Statistics.
However, AFA holds that its move is in line with the Ministry of Agriculture’s policy of exhausting local stock before importing.
Earlier, the AFA promised to issue a statement but had not by the time of going to press. Kenya relies on imports to meet as much as three-quarters of the demand for the commodity used in baking food such as bread, chapati, and cakes.
That prompted Kenya to successfully seek approval from the East African Community’s Council of Ministers to allow the importation of wheat at 10 percent duty for a year from July as opposed to the standard 35 percent for the bloc.
The reduced taxes, Treasury Cabinet Secretary Njuguna Ndung’u said on June 15, will “ensure that there is enough wheat to meet local demand, while at the same time protecting wheat farmers from unfair competition from imported wheat.”