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Millers defy CS Henry Rotich on maize flour prices

Assorted maize flour brands on a supermarket shelf. Millers say they expect the retail price of a 2kg packet to fall to between Sh115 and Sh125 once maize supply constraints from National Cereals and Produce Board stabilise. [Jenipher Wachie, Standard]

NAIROBI: Millers are yet to pass on to consumers the benefits of tax relief granted to them by the Government, with the price of maize flour still out of reach for many ordinary Kenyans.

Beginning this month, Treasury Cabinet Secretary Henry Rotich and his Agriculture counterpart Willy Bett promised Kenyans that the prices of a two-kilogramme maize flour would go down to Sh115 from a record high of Sh153. However, a spot check by The Standard in several supermarkets yesterday showed the price of some brands of maize flour such as Ndovu are still retailing at Sh153, with the cheapest brand trading at Sh144.

“The drop in the price of a 2kg maize flour should not take more than a week, depending on how fast the millers take maize from the NCPB (National Cereals and Produce Board),” said Rotich at a press conference eight days ago.

Contacted for comment, Cereal Millers Association (CMA) Chairman Nick Hutchinson insisted ex-factory prices for maize meal had begun to go down, depending on what he said was the availability of National Cereals an Produce Board (NCPB) maize being released to members.

He said members were receiving a 60 per cent share of the 750,000 bags being released by the Government, translating to 450,000 bags from NCPB.

“We expect that the retailers will pass on the change on ex-factory prices to the consumer. If this happens, we expect shelf prices to settle between Sh115 to Sh125 per 2kg packet,” he said. In his budget speech, CS Rotich zero-rated bread and maize flour to remove VAT from inputs used in their production. However, he warned wholesalers and millers that he would reverse the policy if they failed to pass on the benefits to the consumers.

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He also scrapped import duty on imported white maize from Mexico and Ethiopia to plug the supply deficit until around November when the country expects to harvest its own stock. NCPB Managing Director Newton Terer said last week they received initial request from the Agriculture Ministry to release 750,000 bags of maize. 60 per cent of these maize- 450,000 bags – was allocated to the large-scale millers.

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