August 3, 2010

Bigger local grain production cuts Kenya's corn prices

Kenyan corn prices have fallen as much as 60% in recent months as grain production climbs, the USDA Foreign Service said.

"Farmers who received about 2,500 shillings (US$31) per 90-kilogramme (198-pound) bag of corn during much of the early part of the 2010 marketing year are reportedly now being offered from 1,000 shillings (US$12.51) to 1,500 shillings (US$18.76)," USDA added.

"Corn prices in Kenya jumped last year as drought drove up the price of staple foods. Prices have since declined following heavy rains during the long March to May wet season," Aly-Khan Satchu, an independent analyst, said June 24.

Production of corn, Kenya's staple food, has also increased after the government provided farmers with free seeds and fertilizer.

Higher domestic corn output means Kenya has not imported grain since the second quarter and is not likely to import any "significant" quantities for the rest of the year.

According to the UN's Food and Agriculture Organization, Kenya's per capita corn consumption is 97 kilogrammes (213.4 pounds) a year.