Kenya:Inflation jump threat after maize flour price rebounds

Consumer price of flour has rebounded to Sh130 for a two-kilogramme packet after easing last month as food cost threatens to take inflation to a new short-term high.

This comes as millers warn that the price will continue to rise in the coming days as maize supply in the market gets tighter.

Inflation in January jumped to 9.04 partly egged on by the rising food and water-related costs as a nationwide drought persists.

Common brands like Jogoo are selling at Sh130 from Sh126 last week, Ndovu Sh130 from Sh123, Soko Sh131 from Sh123 and Kifaru at Sh129 from Sh123.

“The situation is getting worse as we are not getting frequent supplies of maize with whatever produce that we get being milled immediately,” said Cereal Millers Association vice chairman Mohamed Islam.

Last month, the price of flour dropped from an average of Sh128 for a two-kilo packet to Sh123 with millers saying that they were benchmarking the drop with the Jamii Unga, which had cut its price forcing major players to follow suit to retain market shares.

Joshua Chepkwony, the owner of Jamii brand confirmed to the Business Daily that they lowered the price per bale but could not provide the figures.

“It is true we lowered our price because we are considerate of our customers. What we are doing is to ensure that we make margins that are reasonable and that will not subject buyers to higher prices,” said Mr. Chepkwony who also owns fibre firm Jamii Telecom.

A recent food status report by the Ministry of Agriculture indicates Kenya will have a maize flour deficit of two months between June and July as the available stocks can only last four months.

The food balance sheet indicates that Kenya had 15 million bags of maize as at January 31.

Credit: Business Daily

Published on 21 March 2017 | 11:43 am at Source