This video shows the maize product, pricing, promotion, distribution activities of a maize miller in Kenya.

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By Standard Team

The Government has announced two sets of prices for maize flour — one for rural and the other for urban areas. Prime Minister Raila Odinga made public the new prices on Monday as escalating food costs threatened the national political space. But the situation could get worse before it gets better as the compromise prices between Government and millers – Sh52 for rural areas and Sh72 for urban areas for a two-kilogramme packet – opened new challenges. There are no safeguards to prevent urban residents from going to the villages to buy cheap flour, nor is poverty limited to rural areas. Crucially, the Government removed middle-men accused of inflating prices, recommending that the National Cereals and Produce Board (NCPB) buy grains from farmers at Sh1,950 for a 90-kg bag and sell to the Government at the same price. But the packaging of the subsidized flour in five and ten-kilogramme packets could spell deeper problems for impoverished Kenyans who thrive on what economists call kadogo economy. The rural poor will have to raise at least Sh130 for a five-kilogramme packet — Sh130 has been the retail price of a two-kilogramme packet since the prices skyrocketed last month. However, urban residents, whom the PM called the "middle income consumers", will buy a two-kilogramme packet of maize-meal at Sh72. Earlier, the PM’s meeting with millers, from which he was expected to announce new retail prices of maize-meal, aborted following a deadlock. The Government sub-committee on agriculture, comprising Agriculture Minister Wiliam Ruto and PS Romano Kiome, among others, could not persuade millers’ representatives to lower prices to Sh45 as proposed. The millers stuck to Sh65, and it appeared they had their say and way as urban stores will sell at Sh72, Sh65 plus 10 per cent profit of Sh6.50.Raila and Mr Ruto had to leave the meeting at the PM’s office for other duties to give millers more time to consult. When they finally agreed, the PM said the new prices had taken into consideration interests of all stakeholders. "We have considered the farmers, millers and consumers. We don’t expect anybody to complain as the measures are temporary," said Raila. Meanwhile, the PM said no buyer would be allowed to purchase more than 10 packets at any given time. "We expect stockists to be identified by the Government soon to stick to the prices we have announced," said Raila.

Ruto added: "As a Government, we don’t expect millers and retailers to increase the prices, but to stick to what we have negotiated and agreed." Raila said the Government decision to intervene and control prices was geared at seeing Kenyans get out of the crisis. The PM said the new prices would come to effect in five to ten days’ time, depending on the distance from the port of Mombasa from where the Government will release 1.2 million bags to millers. Ruto said the Government has also allowed the millers to import 500,000 tonnes of yellow maize, which will be processed to animal feed. "This will leave white maize strictly for human consumption" he said. Millers’ Association Chairman Diamond Lalji said they would comply with the Government so that Kenyans can overcome the maize shortage. Elsewhere, Internal Security Assistant Minister Orwa Ojode has blamed NCPB for the food shortage. Mr Ojode accused the board of recognising middlemen in the distribution chain, thus inflating food prices at the expense of poor Kenyans.

"We must stop politicising the food crisis because it has direct bearing on national security. It is a serious security matter that, if not dealt with carefully, could snowball into a situation we might not be able to control," said Ojode. Earlier on, Prof Yash Pal Ghai, who chaired the Constitutional Review Commission in 2005, blamed the food crisis on failed policies and ineffective Government institutions. Saying the right to food was a human right, Ghai castigated leaders who trivialised serious plans aimed at cushioning the common mwananchi.

"When people demand the realisation of the their right to food, they are not asking the State to carry out an act of charity but the fulfilment of a series of obligations that are legally enforceable," said Ghai. The Government’s announcement of the new prices elicited sharp reactions from leaders who demanded further reduction. "A poor person in the city is the same as a poor person in the rural areas," city lawyer and activist Wangui Mbatia, who works with Bunge la Wananchi (People’s Parliament), said. ODM Chief Whip and Gem MP Jakoyo Midiwo said the Sh65 price did not make sense as consumers could only afford Sh40. Assistant Minister Richard Onyonka said the Government must ensure compliance by traders as it seeks to reduce prices further. Kimilili MP Simiyu Eseli said the different prices reached between millers and the Government were unworkable. "It is simply opening an avenue for bribery as police claim to enforce this unnecessary segregation," Dr Eseli said, terming the intervention "cosmetic". "How will the Government demarcate the boundaries for what prices? It will end up opening room for corruption," he said.