Maize farmers are staring at a crisis, owing to the East African trade protocol that is increasingly allowing import of cheaper maize from Uganda and Tanzania.
Uganda, whose harvesting season started in August, has already imported to Kenya huge quantities of cheaper maize, creating panic among farmers in the North Rift, Kenya’s food basket. The farmers are set to start harvesting in a month, just like those in Tanzania. 
The EAC Protocol allows free movement of goods between East African countries — with the exception of sugar, which Kenya has restricted to protect its industries and farmers.
The protocol also opposes the capping of maize prices by respective governments, in favour of market forces. Kenya, a net importer of maize, has been under pressure to implement the protocol fully.
It traditionally depends on Uganda and Tanzania, which are surplus producers, to bridge the gap. But the two countries have been unable to fully exploit the market due to price setting by the National Cereals and Produce Board (NCPB).
The board is the largest buyer of the staple grain and acts as the country’s maize central bank. When it sets a price, dealers adjust their prices accordingly, creating a ripple effect at both production and consumer levels.
The price of maize across major towns is currently Sh2,900 for a 90-kg bag, except in Kisumu where it is retailing at Sh3,100. But maize from Uganda is already in the country, going for between Sh1,200 and Sh1,500 per bag in Eldoret. This is causing panic among farmers.
WORLD-WIDE PRACTICE
“We cannot allow a free market for a commodity that the majority of farmers depend on; that is the practice all over the world,” Kenya Farmers Association (KFA) director Menjo Kipkorir said.
According to KFA, about Sh1,800 is needed to produce a bag of maize in Kitale. Small-holder farmers are set to be the biggest losers, it says.
“Large-scale farmers with private drying and storage systems will most likely hold on to their maize, but small-scale farmers — who are the majority — will have no option but to sell. They will suffer losses,” said Mr Menjo.
Kenya continues to be a dominant economic force in the East African Community, exporting goods worth Sh105 billion to Uganda and Tanzania anually, compared with imports worth Sh27 billion from the two countries.
But it is increasingly under pressure to allow free flow of maize from Uganda and Tanzania, which accounted for 27.2 per cent and 35.9 per cent of the total imports, respectively.
This would mean doing away with price setting, leaving local farmers to suffer losses as traders and millers opt for cheaper maize from the two EAC countries.
Agriculture principal secretary Cecily Kariuki told Sunday Nation that the government had set aside Sh2.5 billion for this financial year to purchase maize from farmers starting October, adding that they were yet to set a price. “This would be determined by the going prices in neighbouring countries, the cost of production, amount of subsidisation, retail prices in Kenya and the weather patterns. Local farmers should not be worried,” she said.
“As any government would do in a similar situation, we will balance the interests of all stakeholders,” she said.
Data from the Regional Agricultural Trade Intelligence Network (Ratin), a software run by the Eastern African Grain Council that monitors cross-border trade, shows that an average 1,200 tonnes of maize crosses into Kenya from Uganda every day.
Matters have been complicated by the impending El Nino rains, which are likely to coincide with the harvesting period, leaving farmers with no option but to sell at whatever cost to avoid losses. The other option is to dry the maize using dryers, but high energy prices make this option prohibitive.

Source: Daily Nation

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