The government has ordered retailers to immediately lower maize flour prices to Kshs 75 per 2 kg bag down from the current retailing price of between 85 and 90 shillings.
Agriculture Cabinet Secretary Mwangi Kiunjuri said the current certainties in the market shows that retail prices should be less than what is selling now considering that the 90 kg bag has reduced from 3,200 to current Ksh 1600.
Currently, the cost of a 90kg bag of maize is averaging Sh1, 600 which is 50 percent of the 2017 price of KSh3, 200.
Speaking in his office at Kilimo house on Wednesday afternoon, the CS said a survey carried out by the ministry indicated that traders were selling maize flour as high as Ksh 100.
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“We held meetings with Cereal Millers Association last week and yesterday with the United Grain millers association (UGMA) and indications are clear that they will be selling a bale of UNGA between Kshs 700 and Ksh 800 per bale,” he said.
This the CS emphasised that translates to an average wholesale price of Ksh65 per 2kg packet thus the retail prices should not surpass the Ksh 75.
“It is disappointing, surprising and unfortunate that this benefit is not being passed to the consumers. The position of the government is that the 2-kg unga should not retail at more than Sh75,” he emphasised.
Kiunjuri noted that any trader selling Unga at a higher price ofKsh 75 is not only exploiting Kenyans but taking advantage of consumers.
“Government will now keenly monitor the situation and regular surveys will be carried out in the market as we will not allow traders to exploit consumers as much as we appreciate it is a free market,“ he warned.
The CS dismissed excuses that the recent percent Value Added Tax(VAT) increase on fuel products is driving up the cost of maize flour.
“This does not hold given that VAT on milling was zero rated allowing the millers to claim refunds from KRA, Kiunjuri said noting that various initiatives instituted in the subsector since last year when the country experienced acute food crisis following prolonged drought have started bearing good results and mainly market prices stabilisation.
UGM chairman Peter Kuguru said millers will sell maize flour to retailer at not more than Ksh 800 down from the current Ksh 984 per bale translating to Ksh67 per 2kg packet.
He acknowledged that since the prices will come down they immediately expect the same to translate to consumers and that a 2 kg packet will be retailing at Ksh 75 or less .
“We are impressed by the Government interventions in the market so far and we will not contravene the new directive,” said Mr. Kuguru.
Government, Kuguru said has assured of regular release of maize by the national cereals and produce board (NCPB) and thus guaranteeing stable supply in the market.