An agricultural economist says it is unlikely that mealie-meal prices will drop as a result of the expected bumper harvest.
The expert, who spoke on condition of anonymity, said the 75% increase in power tariffs negated any benefits consumers would have gotten. Zambia expects to harvest 3.6 million tons of maize, sparking consumer optimism for reduced prices.
“Ordinarily, the bumper harvest should have helped reduce mealie-meal prices. Sadly, that is highly unlikely as millers are now burdened with increased production costs,” he said.
The national power utility company ZESCO has already implemented a 50% increase, following approval by the national energy regulator. A further 25% increase comes into effect on September 1.
“Millers are already grappling with the high cost of doing business in Zambia and the massive power hike will further hurt the entire value chain of mealie-meal production.”
Mealie-meal prices remained stubbornly high, despite government intervention. The price of a 25kg bag of white mealie-meal is now K130, while yellow is pegged at K100.
The Millers Association of Zambia (MAZ) vigorously opposed the tariff increase, saying it will lead to high mealie-meal prices. Many others, including churches and civic groups, agreed with MAZ.