Africa Newsletter 05-15-20

East Africa Update

The EU Introduces Stricter Measures For Kenyan Beans Exports

According to Business Daily, The European Union will introduce stricter measures for Kenyan beans being exported to Europe from 26th May 2020 as high levels of pesticide residues will result in rejections of cargo. This comes as the EU had initially capped mandatory sampling at 5% but now this has been increased to 10% which will affect suppliers and make the product more expensive.

The cost of the extra checks at 10% will be approximately KES 20,000 which will be passed onto the farmers and middlemen while the conclusion of tests will take an extra day as time is required to produce results.

The export of beans earned Kenya KES 25 billion in foreign exchange in 2019 but this was during a period when the country was listed as having complied with the pesticide requirements.

New Crop Expected In Uganda

Uganda expects a new crop for the shorter season starting in June with maize, beans, soybeans, and some pulses to come into the market. Some of the growing areas have seen floods that have affected large fields but other areas are experiencing good rains.

The government’s food aid programme from the Office of the Prime Minister continues during the lockdown and is expected to go into June as an ease in the restrictions starts to take place.

Maize is currently trading at UGX 1,000 kg in the Greater Kampala area and beans are still trading at UGX 3,800 per kg.

Tanzania Orders foreign Firms To Buy From Auctions

Tanzania is now ordering non-local companies to buy agricultural products from auctions and local markets instead of directly from farmers. The Ministry of Agriculture in Tanzania wants to protect farmers and local operators against low prices and foreign companies.

The Ministry states that this new regulation does not go against East Africa Community Protocol because people are free to move and borders are open but it has been put in place to protect domestic operators and farmers.

According to The East African, Tanzania also targets to store 120,000 tons of cereals with most of it being maize. The Tanzanian government has instructed the National Food Reserve Authority (NFRA) to begin the purchasing of the food crops.

African Countries Advised Against Trade Restrictions

The African Union Commission, Afrexim Bank, and the United Nations Economic Commission for Africa have advised African states against the practice of putting up restrictions for trade with other member states of the AU as the coronavirus continues to threaten many economies across the continent.

In a recently released communiqué, the organizations stressed how regional and international trade is the lifeblood of the national, the regional, and the global economies and that any attempt to disrupt this will further affect any growth.

For more information on how Covid-19 is affecting the global supply chain please see our reports Hot Commodities at panxchange.com/hot-commodities