Unga Group Ltd., a Kenyan grain miller, headed for the lowest level in more than a week after Business Daily reported retailers have started rationing corn flour due to shortages.
The stock snapped two days of gains, losing 55 cents, or 5.2 percent, to 10 shillings by 12:04 p.m. in Nairobi. A close at this level would be the weakest since June 13.
“There are reports that some millers are closing down because of the shortage,” Wycliffe Masinde, an analyst at Nairobi-based Kestrel Capital East Africa Ltd., said in a phone interview today. “There is a feeling that they may not be able to produce to their capacity.”
Retailers are restricting the amount of flour customers can buy as millers have introduced limits and suppliers say there are corn shortages, Nairobi-based Business Daily said, citing supermarket managers including Uchumi Supermarkets Ltd. Chief Executive Officer Jonathan Ciano.
Kenya lowered the tax on imported corn to 10 percent from 50 percent, to offset the rising cost of living, Finance Minister Uhuru Kenyatta said in his budget speech on June 8.