Companies

Producers earn little despite high demand for fresh milk

mziwa

Packets of milk in a supermarket in Nairobi September 4, 2013. DENISH OCHIENG

Kenya is one of the African countries that produce enough milk for its domestic consumption and export, second to South Africa.

Smallholder farmers contribute 80 per cent of the national milk production while large-scale farmers supply the rest.

Annually the dairy subsector produces an estimated 4.8 million tonnes of these cow milk is estimated at 4.5 million tonnes, goat milk 150,000 tonnes and camels produce about 50,000 tonnes.

The sector has been dominated by three major processors Brookside Dairy Limited, New KCC and Githunguri Dairy Farmers’ Cooperative which account for an estimated 85 per cent of the market share.

While the production is normally regular throughout the year production reduces during the dry season mainly due to the lack of feed and dips slightly during cold weather.

The Food and Agriculture Organisation (FAO) estimates that the annual per capita milk consumption in the country ranges from 19kg in rural areas to125kg in urban areas.

Much of the milk is, however, marketed through informal channels and unlicensed vendors, which create the vulnerability of adulteration and expose consumers to health risks.

The dairy subsector also provides creates employment opportunities, FAO estimates that for every 1 000 litres of milk produced daily, about 23 full-time jobs for the self-employed, 50 permanent full-time jobs for employees, and three full-time casual labour jobs are created at the farm level with an additional 13 jobs when the same amount of milk is processed.

According to the Kenya Economic Survey 2013, the volume of marketed milk, which was delivered to processors, in 2012 decreased to 495.2 million litres from 549.0 million litres in 2011.

The drop was seen as a step back from the progressive growth the sector had in the last three years mainly because of reduced production in the early part of 2012 and the increased cost of inputs.

The quantity of processed milk from processing plants last year decreased by 11.3 per cent and attributed to the rise in average price of milk.

The value of marketed milk increased by 6.2 per cent from 14.5 billion in 2011 to 15.4 billion last year an upward trend observed since 2008.

The sector’s main losers have been small scale-farmers who have been receiving meagre cash for their produce.

The average gross prices paid to farmers for 100 litres of milk last year was Sh3,100 up from the Sh2,650 paid out in 2011. The survey documents that in 2008 the average gate price per litre was Sh21, Sh28 in 2009 but decreased to Sh22 in 2010.

The low prices have been attributed greatly to increased hawking and have forced many processors to increase their gate prices so as not to lose out to the stiff competition.