Kenya wants greater share of Zambia, Tanzania and Uganda maize exports

Kenya is seeking to limit Zambia, Tanzania and Uganda from exporting maize to other countries at its expense in fresh efforts to curb the surge in maize flour prices and ease the pinch of inflation.

Kenya traditionally receives imports from Uganda and Tanzania, but trade flows in the grain have shifted to other countries, with the bulk of Ugandan maize now heading to South Sudan, encouraged by higher prices in the country relative to Kenya where a 90-kilo bag is selling at Sh7,000 from Sh2,800 in January.

Countries in the region are also competing for a limited white maize stock for both human consumption and manufacturing of animal feeds following disruption in the supply of the grain from Ukraine and Russia in the wake of the ongoing war between these two countries.

Agriculture Cabinet Secretary Peter Munya says the country has opened talks with the three countries to guarantee Kenya a share of the maize export to plug the shortfall in supplies, which have seen flour prices rocket to a record high of Sh210 (US$1.78) for a two-kilo packet, up from Ksh120 (US$1.02) at the start of the year.

This has triggered a rally in inflation to a 58-month high of 7.9 percent and now, Kenya is seeking a solution from neighboring countries to boost supply ahead of the harvest season that starts in October.

Mr Munya also said the government would intervene on logistical challenges faced by business people in shipping in the produce, which has seen the cost of transport more than double.

In Zambia, a 90-kilo bag of maize is selling at around Sh3,000 but it gets to Kenya at Sh6,000 because of the high cost of transport and other levies involved in shipment. Transporters are charging Sh1,500 for a single bag of maize from either Malawi or Zambia from Sh600 previously, pushing the landing cost of a 90-kilo bag to Sh6,000 when it gets to Nairobi.

The Tanzanian government last month doubled the cost of export permit by 93 percent. The authorities increased the cost of acquiring the license from Sh27,000 per truck previously to Sh52,000 currently, according to border officials.

The Treasury opened the import window in May to allow millers to bring in maize from outside of Africa duty-free. However, the processors said they could not ship in the commodity because of scarcity and high prices in the international market.

The government was banking on imports from outside of Africa to curb the soaring cost of flour, which has been steadily rising since April this year. The sky-high inflation on the back of a jump in the price of essential items such as cooking oil, food, fuel and soap is squeezing household budgets and demand for goods and services.