Dairy farmers bank on plan to stem milk imports to stay afloat

Dairy farmers are banking on recommendations of a task force set up by the government to yank them from the jaws of cheap imports and high production, which are making their lives miserable.

And now the Kenya Dairy Farmers Federation (KDFF) wants the government to, among other things, regulate importation, especially from Uganda, saying it is hurting the local sector.

“The Kenya Dairy Board should regulate the quantity of imports to cushion local farmers from cheap products,” said Mr Gideon Birgen, KDFF chief executive.

According to Agriculture Cabinet Secretary Mwangi Kiunjuri, the task force, which is to table its findings in the next three weeks, will formulate new policies on animal feeds and supplements, marketing issues — including milk hawking — and financial challenges as a result of delayed payments by major milk processors.

“We want to ensure that dairy farmers adopt modern milk production technology to increase production and receive value for their money through value addition and prompt payment for their produce,” Mr Kiunjuri said last week.

He said the government has pumped Sh140 million to construct additional milk coolers, to the relief of dairy farmers who are counting losses after processors cut producer prices due to increase in supply.

“We have constructed a Sh900 million bull station to boost quality of animal breeds at Sh200 for semen, and milk production in the country,” said Mr Kiunjuri.

The glut has been caused largely by imports. Better weather has also seen the processors quickly adjust their prices downwards in the past one month. The processors have reduced purchase prices for a litre by over 40 per cent in the past two months to Sh25 and below.

Data from Kenya Dairy Processors Association (KDPA) indicates that the country’s major diary firms such as New KCC and Brookside Dairies are selling their processed milk products for between Sh34 and Sh38 per half litre to various buyers such as supermarkets.

A spot-check at a number of supermarkets across the country shows that a litre of Kenyan brands is retailing at between Sh100 and Sh110, or Sh50 and Sh55 for half a litre. Brookside is selling half-a-litre at Sh55 while other brands such as KCC, Tuzo and Fresha are selling at Sh50 for half a litre. The 500ml packet is the most preferred size in the market.

Uganda’s Lato is one of the cheapest brands, selling for between Sh45 and Sh47 for a half-litre packet due to relatively low cost of production compared with Kenya.

According to Mr Julius Kiptarus, the director of livestock production in the Agriculture and Livestock ministry, they are coming up with a number of measures to cushion farmers from milk price reduction.

He attributed the recent slump in milk prices that prompted dairy farmers’ outcry over glut in the market, noting that they were monitoring the imports of powdered milk to cushion farmers from price fluctuation.

“We have increased milk production due to the rains and, as a result, milk prices have dropped. We are training farmers on feed and silage making to lower the cost of production, besides controlling the importation of milk powder into the country to protect both farmers and processors,” Mr Kiptarus told Sunday Nation.

Last week, milk farmers blamed the influx of cheaper processed dairy products from neighbouring countries for the reduced prices.

Mr Stanley Ng’ombe, the chairman of Kenya Dairy Farmers Federation, blamed the current glut on inflows from other countries.

“Whereas we understand there are regional trade treaties that allow free trade, we know that powder milk is reconstituted in a neighbouring country and ferried to Kenya, leading to a milk glut,” he said last week.

But Mr Kiptarus assured farmers that the government would continue to monitor the importation of milk powder but has no plans of halting the influx of processed brands from the East African Community.

“Under the EAC protocol, we cannot stop the movement of raw or processed milk. However, we monitor the powder milk … what we look at is the certificate of origin of the raw product of the powder; if it is from elsewhere we stop them,” Mr Kiptarus said.

In the past two years, processors have been buying milk for between Sh43 and Sh35 per litre.