As Kenyans enjoy cheaper maize flour following a government subsidy, farmers are crying foul as prices of the grain, which they are currently harvesting, plummeted.
Kenya in May introduced a subsidy on the produce to cushion citizens from high prices, which had hit 1.5 U.S. dollars per 2-kg tin.
The move saw the price of the commodity drop 60 percent to retail at 0.9 dollars, where it is still currently.
To actualize the subsidy, the government imported thousands of tonnes of maize from Mexico and other countries and distributed it to about 20 millers.
The initiative was to end in September but the government, through the agriculture ministry, last week extended it to beyond the month citing low supplies in the market.
The extension means more duty-free imports, and that is what is hurting East African nation’s farmers as those who planted early are harvesting their produce.
“Where would I sell my produce, which I am harvesting from 10 acres? Prices have dropped considerably yet production costs went up,” Simon Ambuche, a farmer in Kitale, Kenya’s breadbasket, posed Tuesday.
Ambuche noted that this season has been tough for farmers as they experienced various challenges, but mainly erratic rains and fall armyworm attack.
“I am lucky that I even have some produce to harvest because some farmers had their entire crop ravaged by the armyworms, but mine survived. Now I have to deal with lack of market yet I spend plenty of money in controlling the pest,” he said.
The grain farmer said he used at least 500 U.S. dollars to contain the pest, having failed to get enough chemicals from the county government.
A 90-kg bag of maize is currently being sold at between 20 and 23 dollars, prices the farmers blame on continued supply of imported maize into the market due to the government subsidy.
“If we had no subsidy, then we would not be getting maize from as far as Mexico, which means prices would have been relatively higher making us profit,” said Caroline Wangwe, a maize and beans farmer in Kakamega, western Kenya.
With 22 dollars a bag, Wangwe said she is barely making any money on the produce, therefore might not even have cash to use for land preparation in next planting season.
Her hope, and that of thousands of other farmers in maize growing areas of Rift Valley and western Kenya, is that the government announces higher prices at which it will be buying the produce.
Last year, the government bought farmers’ produce at 30 dollars per 90-kg bag, a price some farmers complained was low as they demanded 32 dollars.
The government is expected to announce a new price in October but with expected shortfall in maize production amid rise in imports, the buying price may remain the same as last year’s or even drop.
According to the agriculture ministry, maize production this season would decline by 12 percent or 4.3 million bags due to erratic rains and armyworm attack.
The harvest this season, therefore would fall to 33 million bags, down from 37 million 90-kg bags last year.
If all factors had remained constant, Kenyan farmers would have reaped big from the low maize production as prices would have hit up to 40 dollars per bag.
Bernard Moina, an agricultural extension officer in Kitale, noted that the bulk of farmers in the region would start to harvest next month, therefore, prices may even drop further as the produce floods the market.
According to the Cereal Growers Association (CGA), the subsidy has led to a major drop in prices of the commodity, therefore, opening the door for brokers to mop up stocks from desperate farmers so that they can sale later to the government at a higher price.
“Farmers are crying out for an intervention since the cost of production went up significantly last season. At a production of 14 bags per acre for commercial farmers, the break-even point last year was 40 dollars. This season it has gone up due to drought and pests,” CGA said in a statement this week.
In a recent food security report, the Ministry of Agriculture warned that poor crop performance is expected to continue over most parts of the country. Enditem