Maize trade imports up despite ban
Wednesday August 09 2017
Maize is offloaded from a train wagon at the National Cereals and Produce Board silos in Nairobi. PHOTO | FILE | NATION
The ban on maize exports to Kenya by Tanzania in June has been blamed for the increase in the informal grain trade across the borders, making it the most dominant commodity traded in the unofficial market between the two countries.
An analysis on cross-border trade in the past three months shows that after the export ban, traders found ways to circumvent it.
Tanzania’s food export bans are sometimes frustrated by smuggling across porous borders and complicity by Customs officials; the maize passes through the Namanga and Isebania border posts.
“Exports from Tanzania to Kenya in the second quarter increased by 4,300 tonnes — more than a 17 per cent increase — compared with the same period last year, primarily because of high June prices in Kenya that attracted fresh supplies despite an export ban by the government of Tanzania,” said the East Africa Cross Border Trade Bulletin.
READ: Kenya extends duty-free window for maize
Some 29,546 tonnes of maize traded took up nearly a third of the total volumes that traders moved across the Tanzania-Kenya borders, representing a four per cent increase from the first quarter, said the report by the Food Security and Nutrition Working Group.
It is projected that there will be an increase in moderate exports to Kenya, Burundi and the eastern Democratic Republic of Congo between July 2017 and June 2018 because of low production in the three countries and the good harvest in Tanzania.
“Tanzania maize grain prices are expected to be relatively higher than in 2016 because of the increased cost of circumventing the export ban. Zambian maize grain will likely remain the cheapest in the region, and current direct imports from Zambia to Kenya of 100 tonnes will likely increase,” the bulletin states.
Kenya’s efforts to import maize from Zambia through Tanzania were boosted last month when Lusaka negotiated with Tanzanian authorities to allow passage through the country, with a special lane to facilitate faster clearance and transportation.
READ: Zambia to ship Kenya’s maize by rail
In June 2016, Tanzania’s Minister for Agriculture, Livestock and Fisheries Charles Tizeba banned maize grain export in an effort to curb practices that jeopardised food security such as pre-harvest sale of produce, to encourage value addition, and to promote the export of flour instead.
Analysts say that for Tanzania to achieve value addition, it will be required to meet the needs of the export market for flour. For example, the type of flour preferred in Kenya is less refined than that consumed in Tanzania, Rwanda, Burundi and the DRC.
“Value addition in Tanzania may require investments that can produce flour that is preferred in Kenya and not necessarily the current exports of highly sifted Tanzanian flour which is considered expensive and light on the stomach,” the working group said.
According to the analysis, the prices of maize in eastern DRC, eastern and coastal Kenya, and eastern Burundi will be relatively higher than they were before the ban.
The export ban has also led to traders seeking alternative markets for white non-GMO maize from Zambia, South Africa and Mexico, and yellow maize from Ukraine.