Mealie Meal Prices Fall to K220 as Bumper Harvest Bites

The price of mealie meal has fallen to between K220 and K230 across much of the country, with the Millers Association of Zambia attributing the drop to this year's bumper harvest and the strengthening kwacha.

Association president Andrew Chintala said most millers had begun lowering prices over the past two to three weeks, and that he expected the downward trend to continue as the market settled.

The remarks followed an announcement on Sunday by Sunshine Milling, which cut the price of its mealie meal by K40, from K260 to K220. The miller cited lower maize prices, falling diesel costs, a stronger kwacha and supportive government policy.

Speaking in an interview on Monday, Chintala said the reduction had come directly on the back of the crop forecast survey, which pointed to lower maize prices. Maize costs, he noted, had been the main driver of mealie meal prices.

He said a market survey would confirm that the price range had settled at around K220 to K230, describing the shift as a significant and welcome drop. With an anticipated 4.9 million metric tonnes of maize expected on the market, he said the basic principles of supply and demand made further reductions the natural outcome.

Chintala said the fact that prices were being set by the market rather than external influences meant the reductions were sustainable rather than temporary. He commended millers across the country for passing on the savings, and credited the country's farmers, saying the production figures had made the reductions possible.

He cautioned, however, that the appreciation of the kwacha, now trading at around K17 to the dollar, was weighing heavily on the export market, where pricing had become less competitive. On the domestic front, he said, the falling prices were a cause for celebration among consumers, millers and government alike, and a direct response to the bumper harvest.