REVAMPED

From deathbed, New KCC rises to restore dairy farmers' hope

New KCC was the first in Eastern Africa to process Lactose Free milk at its Eldoret plant in 2019.

In Summary
  • New KCC targets to control at least 40 per cent of the market share this year
  • Sigei: I draw pride in dairy farmers' smiles. My ambition is to ensure no milk goes to waste, target more export market and bring more money into farmers
New KCC managing director Nixon Sigey.
KCC MD New KCC managing director Nixon Sigey.
Image: Felix Kipkemoi

Tom Kigen 78, a dairy farmer in Kipkelion, Rift Valley has kept almost all receipts for milk delivery and payments from the defunct Kenya Cooperative Creameries (KCC)  before its collapse in the 1990s. 

When the Star visited his home over the Christmas holiday, the aged dairy farmer who despite being let down by the firm that collapsed with his over Sh700,000, has passed the trade to his three sons.

''I started delivering milk to KCC in 1977. Life was good. I built this house and bought several parcels of land before the company tumbled,'' Kigen says as he takes this writer through a rusty file where he kept receipts. 

Kigen is just one of the thousands of dairy farmers who suffered heavy losses when corruption took down one of Kenya's colonial-era agricultural cooperation. 

At the beginning of the century, the National Rainbow Coalition (NARC) government under Mwai Kibaki embarked on a mission to reinvent the dairy firm, giving birth to the New Kenya Cooperative Creameries. 

In 2003, it bought the firm from private investors at a cost of Sh547 million due to its importance to the dairy industry. The vigorous reinvention of the firm, however, has been witnessed in the past five years, after the appointment of the current MD Nixon Sigei. 

According to data from the Kenya Dairy Board, the state-owned dairy processor has increased its share in the market from 23 per cent to 35 per cent since 2016 after upgrading of factories in Eldoret and Dandora.

In an interview with the Star, Sigei, who is referred to as Fixer in the dairy circle for his immense role in the sector revamping of New KCC said the firm is set to increase milk sales from farmers in the country from Sh4.5 billion to Sh6 billion following the upgrade of its plants in Dandora, Sotik, Eldoret and Uasin Gishu at a cost of Sh1 billion. 

The milk processor, in which the government is a shareholder, has seen its turnover increased by at least Sh4 billion and Sigei says it has raised above the tides into becoming one of the government’s biggest dividend earners.

In July 2019, President Uhuru Kenyatta commissioned the revamped New KCC processing plant in Dandora at the tune of Sh400 million, targeting farmers from Kiambu, Nyeri, Muranga, Embu and Kajiado.

With an installed capacity of up to 300,000 litres per day, the refurbished plant will see the company doubled its processing capacity to 160,000 litres per day from 80,000 litres per day.

Early last year, President Uhuru Kenyatta launched the construction of a Sh250 million milk cooling plant in Meru County with an assurance that his government will not dither in its efforts to improve the welfare of farmers.

The Nyambene plant will, in addition to bulking and chilling, pasteurize the raw milk before it is transported to processing facilities.

The plant will serve dairy farmers from five of the nine sub-counties in Meru County that include Tigania East, Tigania West, Tigania Central, Igembe North and Igembe South which are currently served by smallholder farmers cooperatives and self-help groups that handle a daily average of 50,000 litres.

Other firms that have undergone upgrading include the Sotik factory at a cost of Sh200 million to increase its processing capacity from 60,000 liters to 100,000 liters of raw milk per day.

It has also installed Sh150 million ultra-modern equipment at the Kiganjo plant in Central Kenya that will also see the facility expand its processing capacity from 70,000 litres to 200,000 litres per day.

The Kiganjo factory is set to establish a new line to make condensed milk that will be supplied to security forces.

New KCC was the first in Eastern Africa to process Lactose Free milk at its Eldoret plant in 2019.

The move to introduce the low lactose milk was to ensure those with lactose intolerance are also consuming milk and the enzymes produced in their body digested.

Lactose Intolerance is known for causing bloating, diarrhea and abdominal cramps.

It is estimated that 75 per cent of the global population and 80 per cent of the African population is lactose intolerant.

The new milk aimed at promoting a healthy lifestyle comes in an orange pack, featuring its prominent crown logo, will enable lactose intolerant consumers to easily digest the milk sugar in which causes stomach discomfort, bloating and stomach upsets to them.

Sigei is optimistic that the company upon completion of the modernisation programme, farmers will get a payout of Sh6 billion and enable the company to remain competitive in the market both in the country and in the region.

New KCC targets to control at least 40 per cent of the market share this year and perhaps dethrone rival Brookside, the current market leader. 

“We are targeting today’s consumers especially the young generation through improved products and those on the go. We have 33 different high-value products as opposed to just milk. We also produce ghee, butter and cream as well as yogurt,” he said.

Apart from processing milk from its suppliers, New KCC offers support to other processors, a move Sigei says is helping in addesssing issues of milk glut. 

''I draw pride in dairy farmers' smiles. My ambition is to ensure no milk goes to waste, target more export market and bring more money into farmers' pockets,''Sigei said.

The revival of New KCC has breathed new life in the family of Mzee Kigen, with his sons now comfortably delivering milk to the company, with hopes of returning to 1980s financial glory.