Tax Relief

Delay in import tax relief retains feed costs excessive

raw materials

Delay in import tax relief keeps feed prices high

Monday 29 November 2021

David Rotich feeds his cows in Kapsosio, Moiben. PHOTO | JARED NYATAYA | NMG

general indandae

BY GERALD ANDAE
More from this author

summary

  • The price of a 70-kilogram bag of milk meal has risen from Sh2,500 in August last year to Sh3,400 now.
  • Kenya depends on the import of sunflower seed cake from Tanzania, while soy is imported from Uganda, Malawi and Zambia to meet the raw material needs of the industry.

A month after President Uhuru Kenyatta issued a directive on urgent measures to reduce the cost of animal feed, the Treasury Department is still pending tariffs on yellow corn.

The president issued his instructions to the Department of Agriculture and Treasury on October 20 to propose intervention measures within seven days of the date to deal with rising feed costs, which have now reached an all-time high.

The Ministry of Agriculture prepared the intervention measures, which included a duty exemption for imports of yellow maize, but the Ministry of Finance has yet to approve the proposal.

Sector stakeholders argue that the delay in approving the aid measures is having a negative impact on both farmers and manufacturers, who are struggling to control costs.

“Prices are still high and processors are now running at 50 percent of their installed capacity because farmers have no demand for feed because of the high cost of the product,” said Joseph Karuri, chairman of the Association of Kenya Feed Manufacturers.

The price of a 70-kilogram bag of milk meal has risen from Sh2,500 in August last year to Sh3,400 now, Chick Swamp retail stores at Sh4,200 from Sh3,250, while Layer Swamp is now at Sh3,800 from Sh3 is sold, 100.

Finance Minister Ukur Yatani did not respond to the Business Daily Inquiry as to when he would approve the intervention measures.

The Department of Agriculture has also proposed a duty exemption on other key raw materials such as sunflower and cottonseed cakes, which are normally imported into the country.

Seed cake

“We have drawn up the framework for any intervention to be taken, mainly to exempt raw materials, and we are now with the Treasury Department,” said Livestock PS Harry Kimtai.

Kenya depends on the import of sunflower seed cake from Tanzania, while soy is imported from Uganda, Malawi and Zambia to meet the raw material needs of the industry.

The Zambian government dealt a blow to the animal feed industry almost three months ago by stopping exports of soy meal and sunflower seed cake. The price of soy has so far risen from Sh65 per kilo last year to Sh130 currently.

[email protected]

Related Articles