The abrupt decision by the Ruto administration to impose a ban on wheat imports has taken millers by surprise, as many had already placed substantial orders for wheat shipments scheduled to arrive as late as January.
Typically, millers engage in forward purchasing, securing grain shipments for future delivery, often with contracts spanning up to three months.
President William Ruto’s unexpected announcement on Thursday declared a halt to all wheat imports, citing the intention to safeguard local farmers.
This development has unfolded against a backdrop where millers are already encountering difficulties in discharging their wheat imports from the Port of Mombasa, which they attribute to government-related complications.
Millers contend that this restriction on imports will adversely impact consumers, as there is currently a shortage of wheat in the local market.
An anonymous miller with significant industry experience stated, “There is very little local wheat available for purchase in the market, perhaps not exceeding 120,000 bags or approximately 10,000 tonnes.
Our country typically requires the import of 150,000 tonnes every month, which underscores the puzzling nature of this directive.”
President Ruto affirmed, “No permits will be issued to millers for the importation of wheat or maize into the country,” reiterating that the primary goal is to safeguard local farmers.
He indicated that the government would only reconsider this directive if the local wheat supply proves inadequate, leaving the fate of previously ordered wheat shipments uncertain.
This move follows a situation in August when millers found themselves stranded at the Port of Mombasa due to the government’s failure to expedite the clearance of their wheat consignments.
The Kenya Revenue Authority (KRA) had ceased issuing the C60 form, a crucial document used by the Treasury for duty remission scheme clearance, leaving millers with substantial quantities of imported wheat in limbo.
The government’s directive had urged millers to prioritise purchasing local crops before turning to the more cost-effective imported wheat.
Under the Ministry of Agriculture’s local wheat purchase program, a minimum price is set for local wheat to protect farmers from imports. Import permits are only issued once allocated quotas, based on milling capacity, have been exhausted.
Kenya remains dependent on imports to meet the majority, approximately 70 percent, of its wheat requirements due to its wheat deficit status.