Food For Thought On Food In Kenya

[hk]

So let's have it for interrogation

So what is your solution? Do have any idea... anything at all... that doesn't involve the "private sector"?

No I don't have a solution that doesn't involve private sector. After all there are no government millers, supermarkets or distributors, so private sector has to be involved.

I'd have found out how many tonnes of expensive maize that the millers have in stock. Then find out how many tonnes of cheap maize needed to be imported (combined with the current expensive miller stock) to reduce the price of unga to the desired price.Import then sell to millers so that they can produce the regular jogoo or soko at the desired price. That way the price  of "jogoo" would come down for every kenyan. The expensive maize can also be milled for brands that aren't price sensitive (fine refined) e.g hostess unga . This would reduce the price of regular brands and there wont be a branded subsidized unga label in the market that the traders can easily repackage and sell at regular price or worse engage in hoarding.

[Omollo]

1. How will you stop them exporting your cheap maize to the neighboring countries where they would fetch higher prices and create a shortage in Kenya?
2. I assume you will force the millers to sell whatever they have in their stores. Do you have any legal basis for that?
3. How about I decide to call your bluff and keep buying and storing. Remember George Soros and Lamont? It was about money but let us apply it ugali. How long can GOK go before it throws in the towel?

I'd have found out how many tonnes of expensive maize that the millers have in stock. Then find out how many tonnes of cheap maize needed to be imported (combined with the current expensive miller stock) to reduce the price of unga to the desired price. Import then sell to millers so that they can produce the regular jogoo or soko at the desired price. That way the price  of "jogoo" would come down for every kenyan. The expensive maize can also be milled for brands that aren't price sensitive (fine refined) e.g hostess unga . This would reduce the price of regular brands and there wont be a branded subsidized unga label in the market that the traders can easily repackage and sell at regular price or worse engage in hoarding.

[hk]

I have no figures but I believe 70% plus of Kenyans are not dependent on the large scale millers but on small posho mills which only grind the grain they bring in for a small fee.

So your solution will be addressing the 30% or so who are urbanized and buy their unga from supermarkets and are slaves of the "Private Millers" which are obviously not owned by the government. A goof number are Kikuyu owned.

http://www.businesslist.co.ke/companies/millers

The posho mill group especially in rural areas are farmers who take their maize produce to posho mill for grinding so technically its their maize. They don't buy maize to grind into unga. So now if they don't have maize they are buying packaged unga.

[hk]

1. How will you stop them exporting your cheap maize to the neighboring countries where they would fetch higher prices and create a shortage in Kenya?
2. I assume you will force the millers to sell whatever they have in their stores. Do you have any legal basis for that?
3. How about I decide to call your bluff and keep buying and storing. Remember George Soros and Lamont? It was about money but let us apply it ugali. How long can GOK go before it throws in the towel?

1. Already you'd have taken the stock of all available expensive maize and the cheap imported maize is duty free. So at the border the duty would have to paid thus discouraging exportation. 2.No millers wont be forced to sell what they have that's why one is to take stock of what they have now then calculate what needs to be imported to combine the two to lower price to desired level. Taking into account in about 3 months cheaper maize will be coming on-board as harvesting season starts.
3. Yes, you can call it a bluff and keep buying and storing but that would mean right now you'd be selling expensive unga while other millers are selling cheaply eroding "your" marketshare.

[Omollo]

Have you ever been to any border? Namanga? Busia? Bungoma? Moyale?

No offence intended from the bottom of my heart but what you are proposing is beyond naive.

That BTW is the current policy which is NOT working. The export of maize is forbidden leave alone taxing it. It is illegal! The amount of grain stored anywhere in Kenya is known or supposed to be known. The ministry uses that data to determine the grain shortfall and set import quotas which are supposed to be subject to biding.

HK baba, it NEVER works. Here is what happens:

1. Maize is exported to wherever the price is right. From Uganda to DRC (very lucrative) to South Sudan and Ethiopia (slowed down when Ethiopia resorted to confiscating the contraband and executing the transporters on the spot)
2. Grain is imported at will and either kept in storage abroad (Mauritius and Durban) waiting for engineered shortages) or brought in as good in transit then diverted with the full help of the officers you rely on to stop its export!
3. Learn about the so called "harvesting Season" in Kenya especially how long it lasts, Baba HK. In some places in Kenya it is never there if so, it lasts about 2 weeks. Maize shortage in Kenya is a permanent situation that only gets worse in some years. There is no maize that has rotted away because of a bumper harvest, Baba HK. Even Pundit can bear witness on this one.

Maize is a commodity that earns money all year round. Yes perhaps some poor man could hoard 20 bags and discover them damaged. A guy moving 10000 bags and above Baba HK would move it to any part of the country,k sell to NCPB at his price and for a cut to all involved, get KPA/ KRA documents as having imported it... what can I tell you?

End corruption and may be... may be .. you end The Grain Shortage Business. The Shortage is the business. Just watch how they are going to play the GoK over it 90 Shilling Experiment.

1. How will you stop them exporting your cheap maize to the neighboring countries where they would fetch higher prices and create a shortage in Kenya?
2. I assume you will force the millers to sell whatever they have in their stores. Do you have any legal basis for that?
3. How about I decide to call your bluff and keep buying and storing. Remember George Soros and Lamont? It was about money but let us apply it ugali. How long can GOK go before it throws in the towel?

1. Already you'd have taken the stock of all available expensive maize and the cheap imported maize is duty free. So at the border the duty would have to paid thus discouraging exportation. 2.No millers wont be forced to sell what they have that's why one is to take stock of what they have now then calculate what needs to be imported to combine the two to lower price to desired level. Taking into account in about 3 months cheaper maize will be coming on-board as harvesting season starts.
3. Yes, you can call it a bluff and keep buying and storing but that would mean right now you'd be selling expensive unga while other millers are selling cheaply eroding "your" marketshare.

[Omollo]

[hk]

Have you ever been to any border? Namanga? Busia? Bungoma? Moyale?

No offence intended from the bottom of my heart but what you are proposing is beyond naive.

That BTW is the current policy which is NOT working. The export of maize is forbidden leave alone taxing it. It is illegal! The amount of grain stored anywhere in Kenya is known or supposed to be known. The ministry uses that data to determine the grain shortfall and set import quotas which are supposed to be subject to biding.

HK baba, it NEVER works. Here is what happens:

1. Maize is exported to wherever the price is right. From Uganda to DRC (very lucrative) to South Sudan and Ethiopia (slowed down when Ethiopia resorted to confiscating the contraband and executing the transporters on the spot)
2. Grain is imported at will and either kept in storage abroad (Mauritius and Durban) waiting for engineered shortages) or brought in as good in transit then diverted with the full help of the officers you rely on to stop its export!
3. Learn about the so called "harvesting Season" in Kenya especially how long it lasts, Baba HK. In some places in Kenya it is never there if so, it lasts about 2 weeks. Maize shortage in Kenya is a permanent situation that only gets worse in some years. There is no maize that has rotted away because of a bumper harvest, Baba HK. Even Pundit can bear witness on this one.

Maize is a commodity that earns money all year round. Yes perhaps some poor man could hoard 20 bags and discover them damaged. A guy moving 10000 bags and above Baba HK would move it to any part of the country,k sell to NCPB at his price and for a cut to all involved, get KPA/ KRA documents as having imported it... what can I tell you?

End corruption and may be... may be .. you end The Grain Shortage Business. The Shortage is the business. Just watch how they are going to play the GoK over it 90 Shilling Experiment.

So the reason why its not practical is cause of corruption? If that's the case fully liberalize the sector let anyone import whatever amount of maize they want without requirement for importation license. Hell why even import maize just import the unga.

[Kim Jong-Un's Pajama Pants]

Maybe he means that they are state-connected businessmen.  Crony capitalists.

[MOON Ki]

People have been eating from Galana, but it hasn't been maize.

http://www.nation.co.ke/news/Galana-Kulalu-food-security-scheme-has-yielded-little/1056-3930084-npkarj/index.html

[Omollo]

So the reason why its not practical is cause of corruption? If that's the case fully liberalize the sector let anyone import whatever amount of maize they want without requirement for importation license. Hell why even import maize just import the unga.

The Gazette notice issued a few days ago does that. Like Nigeria etc, you will be free to import food. What it does to farming lands is your guess and mine.

I can assure you that many people will die - especially the elderly - before the situation stabilizes.

[Omollo]