The demand for sifted maize flour has dropped significantly as more consumers turned to cheaper supplies from posho mills on lower-income due to the Covid-19 pandemic.
The Cereal Millers Association, a lobby of grain processors, said the sales of sifted maize meal has slowed down drastically over the past few months as many households reported reduced or lost income due to pay cuts or retrenchment by corporates hurt by the economic disruption of the pandemic.
"Demand is very low at the moment, in fact, it worse than it was a few months ago when Covid-19 had just struck.
"Low purchasing power has now seen consumers opt for posho mill flour because it is now affordable to buy maize," association chairman Kennedy Nyagah said.
The low demand has triggered a reduction in sifted maize flour prices for the first time in nearly two years.
For example, a market survey shows that a two-kilogramme packet of the Soko brand now retails at Sh103, down from Sh115 while Jogoo and Pembe brands are currently selling at Sh110 and Sh108, respectively, compared to an average Sh115 previously.
On the other hand, a consumer would spend close to Sh80 in obtaining 2kg of maize and milling it at the posho mill, making it way cheaper than processed flour.
The cost of maize, which forms 80 per cent of the raw material used in the production of flour, has been declining since September with the onset of harvesting in some parts of the north rift.
Mr Nyagah says millers are getting maize at Nairobi for Sh2,600 for a 90-kg bag from traders. This is a decline from Sh3,800 that the same quantity was trading at between March and September this year.
However, the cost of the grain at the farm gate has dropped to a low of Sh1,800 for a 90-kilo bag in most parts of the North Rift.
Maize from the South Rift, which comes just two months to the start of the main harvesting season in the North Rift, saw the cost in August drop to an average of about Sh3,000 per bag.