SH5 INCREASE

Milk prices to rise if drought persists

Enough powdered milk to last until the end of May

In Summary

• Cost of packet of milk likely to increase by about Sh5 next month if the drought persists. Other dairy products to cost more 

•New KCC boss says the current stock of 1,500 metric tonnes of powdered milk will last until next month 

Milk on display at a supermarket /FILE
Milk on display at a supermarket /FILE

A packet of milk at the supermarket may increase next month by about Sh5 if the dry spell persists.

The New KCC boss said the country has enough powdered milk to last until next month.

MD Nixon Sigey said the drought has drastically reduced the supply of milk and the situation is likely to get worse if there are no rains in the next month.

 

The price of 500ml milk is about Sh50 to Sh60; it could rise by about Sh5, he told the Star on the phone yesterday. 

Costs of yoghurt, cheese, butter, whipping cream, lala maziwa, ice cream and other dairy products will also increase.

Sigey said there are 1,500 metric tonnes of power milk to stabilise the consumer prices until next month.

“Our milk plants in Eldoret, Kitale, and Kiganjo are able to convert the excess milk we received in November and December into milk powder which is now stabilising the consumer prices,” he said.

New KCC and Brookside have since increased farm-level milk prices by Sh5. The processors are buying milk from farmers at Sh36, up from Sh31 due to demand and supply issues.

Sigey said the situation would have been worse if most of them had not stored powder milk in their processing plants.

He said the dairy sector should learn the cycle of drought, which happens every two years, hence the need to ensure feed conservation. This will help the country remain competitive.

 

“It is very critical for farmers to ensure a consistent supply of milk by conserving hay and silage. The current situation was not anticipated, the rains have delayed by one month and the supply has drastically dropped,” he said.

This has also led to an increase in the cost of feed, which raises the cost of producing milk by Sh22.

According to the Tegemeo Institute, the cost of producing a litre of milk in Kenya is Sh19 to Sh22. But industry players want the cost reduced to Sh14 so the country can remain competitive in East Africa.

“The drought situation will happen again in the next two years. For planning purposes, the national and county governments, extension services and milk processors must team up and ensure consistency in supply. This will avoid these seasonality issues,” Sigey said.

Margaret Kibogy,  MD of the Kenya Dairy Board, said they are monitoring the situation to ensure that consumers do not suffer.