The government may not renew or extend the window for exemption from import duty on raw materials for the manufacturer of animal feeds.
Livestock PS Jonathan Mueke said the government may not extend the import window because the country has experienced a bumper harvest for the 2023 long rains season maize crop.
He told the Star during an interview that his team is monitoring the situation and will advise accordingly once the duty exemption window comes to an end this month.
“My team is currently doing the analysis to see what the effect of the rains has been. We have had a shortage of feeds because of the drought which was the worst Kenya has experienced in 40 years. We are looking into our animal feed balance sheet to see how much has improved since the rains," Mueke said.
"If we do not need to import and we already have enough feed manufactured locally, then we will not renew or extend that,” he said.
This is after animal feed millers requested for an extension of duty waiver on raw materials to make animal feeds.
On January 30, the Association of Kenya Feed Manufacturers urged the government to extend duty waiver on raw materials to cushion dairy and poultry farmers against high prices of feed.
This will be the third time that the government will extend the waiver on yellow maize, soya beans meals and vitamin premixes.
On August 11, 2023, the government allowed for an extension of duty waiver until February 2024 through a gazette notice.
The gazette notice indicated that exemption from import duty on raw materials for manufacture of animal feeds is notified for the general information of the public.
“Pursuant to the powers conferred to the Cabinet Secretary for the National Treasury and Economic Planning under section 114 (2) of the East African Community Customs Management Act, 2004 read with provisions of Item 20 Part B of the Fifth Schedule to the Act and in the spirit of government policy to increase livestock productivity and market access in Kenya by the Cabinet Secretary for Agriculture and Livestock Development, an exemption from import duty shall apply in respect of commodities to be imported into the country on or before the 7th February, 2024, by millers and feed premix formulators,” the notice read.
It allowed for importation of 500,000 tonnes of yellow maize,150,000 tonnes of soya beans, 30,000 tonnes of feed additives, 10,000 tonnes of assorted protein concentrates and 37,500 tonnes of premix ingredients.
The PS confirmed the duty waiver was able to bring down the price of a 50kg bag of dairy meal from Sh5,800 to about Sh4,970.
“This is input for the dairy farmer, beef and goat farmers. The government is doing a lot to enable farmers to produce because agriculture is pillar number one and the biggest driver for the country’s economic transformation,” Mueke said.
With the window coming to an end this month, millers are still requesting for an extension of the duty citing that prices of raw materials such as maize have not stabilised hence the cost of feed remains high for most farmers.
Association of Kenya Feed Manufacturers chief executive officer Paul Kamau had expressed optimism that the duty waiver will be extended.
“The waiver has helped to stabilise and maintain the price for a long time. Most of our millers have not increased prices for a couple of months. But some of the millers are now thinking of increasing because the dollar has gone up significantly. Some 90 per cent of the raw materials in the animal feed industry is imported so when there is a fluctuation in dollars, the cost goes high,” he said.
“We are hoping there will be another waiver because we still have a challenge in getting maize, and we are yet to start benefiting from the rains. We are still competing for the white maize available in the market with millers who make maize meal for human consumption,” Kamau said.
