The Millers Association of Zambia – MAZ has denied assertions by some industry players that the continued issuance of export permits for maize and mealie meal by the Agro Ministry is behind the market price hikes of mealie meal in Zambia.
Analyst say the recent hike in fuel prices by 20 to 30% has also contributed to the hike as both millers and traders are facing elevated costs of transport and distribution.
MAZ instead pointed out that the increase in prices of mealie meal on the market is because of the upward adjustment of maize prices on the open market. MAZ President Andrew Chintala said the traders increased the price of maize in November 2021 without giving a reason therefore they should be the ones to justify that decision.
Speaking in an interview with the Zambian Business Times – ZBT, Chintala said the export of maize has nothing to do with the increase in prices of mealie meal as exports have been going on since May 2021 and the market was not disturbed until the month end of November 2021 when prices of maize started going up adding that traders canceled existing contracts for new ones as they wanted to increase the price of maize.
He noted that the demand for maize is low and the demand for mealie meal is not as huge as people thought it would be as traders are struggling to sell mealie meal in Congo DR as well as on the local market.
“So if we compare the prices on the local market and export market, the margins are very minimal, one would even wonder to say why are the millers exporting, the reason why we are exporting is to try and get the volumes, so when you look at the price differential, it’s not significant and we are trying to push the prices low on the local market so that we can try and maximize on the exports but it’s not happening so it has nothing to do with exports”he said.
Chintala also mentioned that the increase in fuel prices has also affected the maize price as transportation costs of moving maize may have gone up adding that there are a number of factors that have affected the increase in maize prices and fuel is just one of the components that goes in the costing structure but is not significant.
“We had contracts where we were getting maize at K2,700 then the trader just says we cannot continue selling at K2,700, the price is now K3,500 until it got to K3,800 per tonne which is about K190 per 50Kg bag and the month before that we were paying K135 so from K135,the price moved to K190 which is a huge increase”he said.
He explained that the increase is minimal in terms of margin but on the open market, traders and marketeers have taken advantage of the inflated prices circulating on social media but prices obtaining in most large supermarkets are ranging between K125-K136.
The MAZ President has appealed to consumers to buy mealie meal from designated selling places of milling companies in order to avoid being exploited by traders who want to take advantage of the situation and create distortion. He noted that the issue is receiving active attention from all the stakeholders.
