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UPDATE 2-Kenya to subsidise maize imports to lower flour prices
May 16, 2017 / 2:01 PM / 3 months ago

UPDATE 2-Kenya to subsidise maize imports to lower flour prices

(Updates with retailers' actions, prices)

By Duncan Miriri

NAIROBI, May 16 (Reuters) - Kenya will offer subsidies to maize importers to help lower the cost of maize flour which shot up due to a regional drought, Agriculture Minister Willy Bett said on Tuesday.

Rising prices of staple maize flour and other foods has become a political headache for President Uhuru Kenyatta as he seeks a second term in August elections.

He is running against veteran opposition leader Raila Odinga, who has used the high costs of living to portray Kenyatta's government as inept and uncaring.

Bett said the subsidy programme, whose total cost he did not give, would lower the price of a 90 kg bag of maize to 2,300 shillings ($22.27) from above 4,000 shillings, meaning a 2 kg packet of flour would sell for 90 shillings.

The price of a 2 kg packet of maize flour jumped by a third to 135.87 shillings in April from the same period last year.

"The priority is for Kenyans to get food at an affordable price," Bett told a news conference at his office.

Bett said there were enough stocks of maize in the country to last until the end of the month.

He said the plan was to import 2.9 million bags of maize in June and subsidise up to about 5 million bags until harvests come in.

The government has allowed millers to import maize from any country where they can get the grain, officials said. The government was also seeking to import maize from Ethiopia and Zambia, the officials said.

Bett said the government was also looking at a similar plan to intervene and lower the cost of milk and sugar.

Sugar prices have also jumped in recent months and some dairy products such as butter have gone missing from shelves as processors stop production to keep fresh milk supplies going.

Retailers have been limiting the amount of maize flour, sugar and butter a single customer can buy as the shortages sour the national mood ahead of the polls.

"We don't want to encourage anyone to carry four packets of sugar, we think it would be nice if the next person also gets some," Wambui Mbarire, the chief executive of the Retail Trade Association of Kenya (RETRAK),told Reuters. ($1 = 103.3000 Kenyan shillings) (Editing by George Obulutsa, editing by Louise Heavens)

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