Maize Subsidy Expected to End in October, says Ministry of Agriculture

The harvest season for maize in Kenya is here with us in the large-scale producing regions of Rift Valley and Trans-Nzoia.

With these, the subsidy Maize that Kenyans have been enjoying for the past four months is formally going to end on October 31 so as to give room for farmers to sell their produce to the state, according to the Cabinet Secretary of Agriculture, Willy Bett.

This is a slight extension from an initial mid-October date announced by Treasury Secretary Henry Rotich last week when he appeared before a special Parliamentary committee scrutinizing the supplementary budget.

According to Bett, the Extension came about so as to have a proper exit plan for the Subsidy.

“We must be certain that there would be no spike in the cost of flour, that is why we want it to come to an end on October 31,” said Mr. Bett, adding that an assessment by the Agriculture ministry showed that new maize stocks from the main producing areas of the North Rift region are expected to enter the market at the end of October.

The close of the subsidy could provide relief for growers who had opposed its extension beyond the current harvest window, saying such a move would have destabilized the market.

The Cereal Growers Association two weeks ago claimed the subsidy had triggered a dip in farm-gate prices to Sh2,300 per 90-kilogramme bag, giving room for brokers to profiteer by mopping stocks for sale to the National Cereal and Produce Board at higher prices yet farmers faced losses due to the high cost of production.

But despite the end of the subsidy, the government may be forced to consider similar interventions next year amid projections of steep maize imports from April to cover for a shortfall of about five million bags from the long rains season.

Egerton University’s Tegemeo Institute last week said a projected harvest of 32 million bags of maize from the long rains season would only serve the country’s consumption demands until April.

The country requires an average 36-40 million bags of maize annually to satisfy demand, estimates by the Agriculture ministry showed.

Prolonged drought in the first half of the year coupled with an infestation of the Fall armyworm pest cut maize output down from 37 million bags realized last year.

Maize production is expected to decline by between 20 and 30 percent this crop year due to insufficient long rains and infestation by the fall armyworm across 27 counties.

According to the 2017 Long Rains Season Assessment Report, Kenya did not experience sufficient rains between March and May with some areas receiving as low as 50 percent of normal rainfall.

“The 2017 March-May long showers of rain arrived late across most of the country and delayed by between one and four weeks in the marginal agricultural and pastoralist areas. Most parts of the country received 50-90 percent of normal rainfall,” states the report.

It adds that food security will be affected as rangeland resources deteriorate, food prices remain high and agricultural incomes remain low. “Food consumption will decline as more households increasingly rely on coping strategies to fill gaps,” it notes.

Kenya consumes three million bags of maize monthly since the cereal is the Country’s staple meal.