The federal government stands to lose over Sh5 billion for the 1.7 million baggage of maize it launched to millers at a low price beneath a subsidy programme to cushion shoppers from excessive flour costs.

The Strategic Grains Reserve (SGR) now needs a Cupboard approval of the losses to facilitate launch of an extra 1.5 million baggage of grains forward of importation of 12.5 million tax-free baggage of maize because the flour costs stay excessive in most stores.

“The federal government ought to take duty for the losses contemplating the truth that we bought the maize at Sh2,300 per 90kg baggage, which is far decrease as in comparison with the prevailing market costs of above Sh3,000,” defined Dr Noah Wekesa, the chairman of the SGR.

The NCPB is releasing the subsidised maize promoting at Sh2,300 per bag towards Sh3,200 by merchants attributable to an acute scarcity of the grains out there.

Dr Wekesa disclosed that millers have exhausted the 2 million baggage of maize launched final month, ensuing within the rise in the price of flour.

“We allotted 1.7 million baggage to millers for human consumption and a further 300,000 baggage for manufacturing of animal feeds however a few of them have cleared the shares,” mentioned Dr Wekesa.

The federal government now plans to import 12.5 million baggage for family consumption and two million for processing of animal feeds.

In response to Agriculture Chief Administrative Secretary Andrew Tuimur, the nation has sufficient maize to final this month and duty-free maize can be imported subsequent month. However the SGR board has maintained that it’s going to launch further maize solely after the Cupboard approves the losses it has incurred.

The federal government pumped in Sh6 billion in 2017 to import maize beneath the subsidy programme to decrease flour shelf costs that had hit Sh153 for 2kg pack, earlier than coming right down to Sh90 following the intervention.

It had imported 10.four million baggage primarily from Mexico and African international locations to comprise the excessive value of maize flour and make it inexpensive to shoppers.