Why Kenyans Are Staring at High Wheat Prices

Cereal Millers Association (CMA) of Kenya have warned of a possible increase in the prices of wheat in Kenya.

In a statement dated February 17, CMA Chief Executive Officer (CEO) Paloma Fernandes said the Association remains committed to purchasing locally grown wheat and protecting local farmers.

However, he pointed out that structural challenges continue to hinder the growth of the industry.

Fernandes highlighted high production costs, low yields per acre, and limited mechanization that have made Kenyan wheat less competitive compared to imports.

A photo of wheat farmers in Merewet in Moiben Constituency, Uasin Gishu County. PHOTO/ Peter Ochieng, Standard. — A photo of wheat farmers in Uasin Gishu County. PHOTO/ Peter Ochieng, Standard.

He explained that farmers struggle with high input costs, including fertilizer and fuel, making local wheat more expensive than imported alternatives.

The CEO said CMA members operate under a duty remission scheme, which requires them to prioritize local wheat purchases at a premium price, before seeking import approvals, which allows them to import wheat at a 10% duty.

For the 2024/2025 season, millers are purchasing local wheat at Ksh5,300 per 90kg bag, a rate higher than the global import parity price of between Ksh3,500 to Ksh3700, a difference of close to KES 1,500 per 90kg bag.

However, Fernandes revealed that the delicate balance is currently being threatened by severe delays in government import approvals, leading to skyrocketing demurrage costs at the port.

“If these bottlenecks persist, Kenya risks market instability, potential wheat shortages, and higher consumer prices,” he said.

Purchasing Local Wheat

Besides, he dismissed claims suggesting that millers are unwilling to purchase local wheat, leaving farmers in Narok County with unsold stock worth Ksh50 billion.

He clarified that the reports are inaccurate and misrepresent the realities of Kenya’s wheat production, procurement and market dynamics.

He stated that Henya produces only a fraction of its national wheat demand, with local farmers supplying approximately 7% of the 24 million bags consumed annually.

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CMA account for over 95% of the wheat milling in Kenya.

Fernandes explained that CMA members have consistently purchased all available local wheat every season over the last 15-20 years contrary to recent reports.

“In the 2023-2024 season, CMA millers procured the entire 1,458,881 bags produced. For the 2024-2025 season, as of February 10, 2025, 1,246,000 bags had already been purchased, demonstrating our continued commitment to supporting local farmers,” he said.

Furthermore, he stated that the claim that Narok alone has unsold wheat worth Ksh50 billion is factually inaccurate.

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Wheat Farming in Kenya

According to CMA, Wheat farming in Kenya extends beyond Narok to regions such as Nakuru, Laikipia, Uasin Gishu, and Timau.

The Association said the total national value of wheat produced across all these regions based on the 1.7 million bags expected this season at Ksh5,300 per bag stands at approximately Ksh9 billion not only Ksh50 billion as alleged.

“It is worth noting that 50B worth of unsold wheat equates to 10 million bags which is approximately 6 years of local production,” Fernandes said.

He emphasized that CMA remains committed to supporting local wheat farmers and strengthening Kenya’s wheat value chain.

However, to ensure a sustainable future for the sector, the CEO said all stakeholders must work together to address inefficiencies, improve farm productivity, and remove trade barriers that disrupt supply chains.

This includes farmers, policymakers, and the government.