Commodities

Milk prices surge as shortages bite

milk

A woman buys milk at a Nyeri supermarket. FILE PHOTO | NMG

geraldandae

Summary

  • The price of a 500ml packet has now gone up by a further Sh3 across all the brands, subjecting consumers to more pain at a time when they are grappling with an increase in the cost of other basic commodities.
  • Supermarkets have had to deal with limited supplies from processors, a move that has seen stocks run out by evening every day for the last three weeks, forcing their customers to buy in bulk.
  • The price of other high-value products such as butter (500 grammes) and cheese (250 grammes) have also increased by Sh26 and Sh5 respectively.

The price of milk has gone up for the second time in a fortnight leading to panic buying in retail outlets as consumers purchase more stocks for future use as uncertainty looms in the dairy sector.

The price of a 500ml packet has now gone up by a further Sh3 across all the brands, subjecting consumers to more pain at a time when they are grappling with an increase in the cost of other basic commodities.

The latest increment comes as a blow to consumers given that retailers had already reviewed prices of the commodity by up to Sh5 early for a 500ml packet last month.

Supermarkets have had to deal with limited supplies from processors, a move that has seen stocks run out by evening every day for the last three weeks, forcing their customers to buy in bulk.

The price of other high-value products such as butter (500 grammes) and cheese (250 grammes) have also increased by Sh26 and Sh5 respectively.

Naivas Supermarket chief operations officer Willy Kimani says they are not getting enough stocks at the moment as they used to previously.

“This is caused by limited supply to us. Customers have also been buying milk in bulk, more so the long life,” said Mr Kimani.

Processors are grappling with a decline in supply that has forced them to operate below installed capacity as the ongoing drought in milk-producing zones take a toll on quantities.

Kenya Dairy Board said the current situation has been precipitated by the ongoing drought in most parts of the country.

The regulator said poor rains in the last quarter of 2021 and a drought condition in the quarter that ended March have had a negative impact on production at the farm level.

The situation is expected to be even worse as processors do not have stocks of powdered milk, which they normally reconstitute into fresh when there is a shortage in the country in order to tame high prices.

Processors have previously justified the increment in the price of the milk, citing a sharp rise in producers’ prices that can be as high as Sh45 for a litre of the commodity.

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