Commodities

Milk supply plunge sees prices rising steadily for weeks

milk

A past milk quality testing by Brookside Dairy at Dundori in Mirangine, Nyandarua County. PHOTO | FRANCIS MUREITHI | NMG

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Summary

  • Data from the Kenya Dairy Board (KDB) shows that the volume of the commodity supplied to processors declined to 61.7 million litres in March from a high of 69.3 million and 66.4 million litres in January and February respectively.
  • The decline has led to a sharp shortage in the market, which has pushed the price of a half-litre packet to Sh60 and resulted in absence of long-life milk on the shelves as processors concentrate on first moving fresh brands.
  • Processors have been operating at half of their installed capacity due to a shortage in supply from farmers across the country.

Formal milk intake has been on a steady decline between January and March, piling pressure on consumer prices at the shelf.

Data from the Kenya Dairy Board (KDB) shows that the volume of the commodity supplied to processors declined to 61.7 million litres in March from a high of 69.3 million and 66.4 million litres in January and February respectively.

The decline has led to a sharp shortage in the market, which has pushed the price of a half-litre packet to Sh60 and resulted in absence of long-life milk on the shelves as processors concentrate on first moving fresh brands.

Processors have been operating at half of their installed capacity due to a shortage in supply from farmers across the country.

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

The current rains will, however, see a regeneration of grass in most parts of Kenya, which will give a major boost in production as a lot of farmers rely on open field grazing for their cows.

“Volumes will start on an upward trend with the rains that we have witnessed in some parts of the country,” said Margret Kibogy, managing director KDB.

Kenya Dairy Processors Association had late last month projected that normal supplies will resume in two weeks’ time following the rains that have been pounding in most parts of the country.

However, the situation could take longer following sudden cessation of rains in some parts of the Rift Valley, which accounts for up to 80 percent of the total milk that is produced in the country.

The Ministry of Agriculture had in February recommended a one-month window period for the importation of milk to address the current shortage and tame high prices.

The ministry said there was generally reduced milk productivity as a result of poor rains and it wanted processors to be allowed to import UHT and powder milk to ease the situation.

The country has so far exhausted stocks of powder milk that is normally reconstituted into fresh during dry season in order to supplement limited supplies coming in from farmers.

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