Societies hold key to thriving dairy enterprises

For a long time, farmers’ dairy co-operative societies shied away from uniting due to mistrust and perceived threats from fellow competitors.

However, through heightened awareness on the importance of having a “common voice” in the milk industry, seven milk co-operative societies— Endarasha, Mweiga, Watuka, Gataragwa, Thuruthuru, Lamuria and Nairutia — in Nyeri county joined hands to establish a private company known as Kieni Dairy Products Limited (KDPL) in 2009.

The company, which boasts a 40,000 litres capacity milk chilling plant, enjoys an annual turnover of Sh320 million.

“This would not have been possible without the collaboration of all the co-operatives,” says George Muita, Manager of KDPL. He says the company collects over 28,000 litres of milk daily from all co-operatives. It is then bulked, chilled and sold fresh to major milk processing plants that offer competitive prices.

Muita notes that as the company generates more profit, monthly payments to dairy farmers has steadily increased from Sh25,000 in 2011 to the current Sh30,000.

In fact, we are encouraging our farmers to buy shares so that aside from better payments, they can also enjoy dividends.”

Indeed, due to the milestones achieved, KDPL attained the first position in Financial Management out of 21 Dairy Farmers’ Business Associations that were supported by the East Africa Diary Development Project.

“We attribute our success to the power of collective bargaining which can only work if dairy farmers join forces. This has enabled us select highest bidders who offer best prices for our milk,” Muita says.

He notes that a fraction of the company’s profit is reinvested into extension services offering farmers training and other services aimed at continuously improving dairy farming and milk yields.

The company has also invested in facilities that measure milk density and acidity levels to ensure milk delivered meets accepted national standards.