Consumers’ shock as fresh milk price goes up again

By Jackson Okoth

The price of fresh milk, a key item appearing on one’s daily shopping list, has gone up again.

 A spot check on Thursday revealed an increase in the retail price of major milk brands at various outlets.

Milk dominates breakfast budget for many low-income households in Kenya.

The price of a half-litre packet of almost all the popular brands went up from Sh35 to Sh40, hitting low-income households between the eyes.

A 500 ml packet of fresh milk brands including Ilara, KCC, Daima and Molo milk went up by Sh5 in almost all outlets in Nairobi’s Eastlands area.

Price impact

By close of business on Thursday, only Fresher Milk brand, owned by Githunguri Dairy Farmers, had not adjusted its prices.

“While I need two packets of milk to prepare breakfast every day, I have had to cut down to one packet on some days. Now with this latest increment, the situation for me has worsened,” said Jackline Musili, a housewife in Umoja, Nairobi.

“We have adjusted our prices to Sh40 for the half litre pack but will give you more details on what has informed this adjustment,” said Gladys Some Mwangi, Corporate Affairs Manager, New KCC.

Interestingly, industry regulator Kenya Dairy Board (KDB) appeared to be in the dark concerning these hikes in retail prices, only promising to provide more details on the matter at a later date.

 Brookside dairy prices stand at Sh48 for the Brookside triangular 500ml pack, Ilara 500ml at Sh43,  Ilara pouch at Sh38, 500ml Delamare pouch at Sh33 and the 500ml Delamare square pack is retailing at Sh43.

Farmers acknowledge that while the ongoing cold and dry spell in most parts of the country has affected supply at the farm level, current price adjustments at the retail shops is unjustified.

“The price adjustment is a result of collusion between the few big players, who dominate the milk processing business,” said John Wachira, Secretary, Dairy Traders Association.  “They fix prices at will. We are encouraging members to sell their milk at the farm gate, to offer some form of competition to established players.” 

While key processors in the milk business have in the past indicated plans to increase capacity to turn milk into power, to take care of erratic supply during dry spells, frequent shortages still affects pricing of milk.

“At the moment, farmers are selling at Sh32 per litre to processors who in turn peg producer prices at almost three times more, at Sh90 per litre,” noted Wachira.

The ongoing cold and dry spells has also affected the informal sector where farmers have increased their prices to between Sh1 to Sh2 per litre.

There are fears that milk supply at the farm level could worsen, providing an opportunity for processors to further hike prices.