New KCC on Tuesday became the second milk processor to raise producer prices by Sh3 after rival Brookside, citing the high cost of farm production.
Under the new scheme, which provides uniform payments countrywide, farmers’ groups will earn Sh40 per litre while individual producers will get Sh35.
“In view of the current drought New KCC has increased raw milk prices by Sh3 to cushion farmers against high cost of feeding dairy cows,” said New KCC chief executive officer Nixon Sigey.
He said the current dry conditions had cut milk supplies to the firm by between 20 and 30 per cent.
“If the situation continues, matters could get worse. We are using our extension services to train farmers on feed conservation,” he said on Tuesday.
Brookside Dairies on Monday announced an increase in the milk price by Sh3 for contracted farmers countrywide.
In a statement, milk procurement director John Gethi said the move was aimed at encouraging suppliers to invest more and take dairy farming as a commercial enterprise.
“This is an incentive meant to cushion farmers from the effects of adverse weather experienced in the country over the past two months. It will help farmers to recover their milk production costs and enable them to prepare adequately to grow and conserve feeds as we approach long rains,” he added.
Each farmer supplying Brookside dairies will earn Sh35 a litre.