Deputy President Rigathi Gachagua has said the government is working towards reforming the diary sub-sector.
This will be done through the modernisation of the New Kenya Cooperative Creameries (KCC) factories and the subsequent expansion of its market.
"We are going to create market for New KCC in government institutions. If there is a good market, the company will increase prices. Other private companies will also increase prices because of competition in the market," he said.
He was speaking on Tuesday when he visited the New KCC milk processing plant in Dandora, Nairobi.
Gachagua further said the product will get market within the national and county government institutions and school-feeding programmes.
He added that they will introduce far-reaching reforms which will increase returns for milk farmers with farm gate prices increasing up to at least Sh60 per litre.
These are part of the state's efforts to transform the dairy industry and empower the company so it can process milk for local consumption and for the foreign markets.
Gachagua is set to hold a conference bringing together all the diary stakeholders to come up with strategies to transform the sub sector.
The government aims to double the processed milk to over three million litres per day for higher returns to farmer.
The DP said this will double the sub sector's contribution to Kenya's Gross Domestic Product with up to eight per cent.
"Doubling the deliveries also means we are not only improving our food security, but also multiplying direct jobs from the current 750,000 to over 1.5 million. This is rather urgent in contributing to sorting out unemployment," he said.
He noted that the state-owned entity will cushion farmers and consumers against market forces like fluctuation of prices.
"The New KCC is a government-owned entity and is the vehicle that will sort out the dairy farmers. It is the organisation that serves the farmer, is not a profit-making entity," he said.
Gachagua urged the company to lead in diversification to more valuable products beyond the powdering of milk and traditional products.
With him was MSMEs CS Simon Chelugui, New KCC Board chairman David Maina and the company's managing director, Nixon Sigei.
Others were MPs James Gakuya (Embakasi North), Benjamin Gathiru aka Major Donk (Embakasi Central), Maina Mathenge (Nyeri Town), Joseph Cherorot (Kipkelion East).
