February 7, 2012

Duty free corn imports have ended last December and have been re-introduced by the Kenyan government causing millers to stop the importation.

The National Cereals and Produce Board (NCPB) on the other hand said the price of corn locally has dropped after the board stopped buying the produce from farmers due to lack of money. Millers are now buying corn locally but at less than KES3,000 (US$35.95) per bag which NCPB was offering. Some of the millers and middlemen are offering between KES2,600-2,900 (US$31.16-34.75) per bag.

However NCPB Managing Director Gideon Misoi told farmers to stop selling their corn at throw away prices because the market prices are likely to go up by more than 40% in the next two months. Misoi said low harvest of corn in Eastern and the South Rift region may lead to marginal shortages of corn at the end of the first quarter of this year. "We have educated farmers to store their corn either at NCPB or at their homes until the prices in the market get better within the next two or so months," said Misoi.

He said the NCPB would help farmers to store their produce at the board's depots or alternatively the board would also send its officers to help farmers who were willing to store the corn in their homes. Last week, the government stopped further funding to the NCPB for the purchase of corn. NCPB will not pay for any new deliveries of corn to the board but farmers are free to use the warehouses to store their corn under the Warehouse Receipting System.

The board's spokesman Evans Wasike, said the Ministry of Special Programmes had exhausted the KES2 billion (US$24 million) set aside for the purchase of 650,000 bags. "At the moment, we have no extra money to take in more corn and pay for it as has been the case but farmers can use the board's stores to keep their stocks and sell it out on their own terms. They will only pay us for storage charges," said Wasike. The move to stop funding came as many farmers said they still had huge stocks that have not been bought to sell to the board. "We are still looking at other ways to get money for corn purchase and to help us import more fertiliser", said Misoi.