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Production costs rob dairy farmers' joy

By Fidelis Kabunyi | October 19th 2021

Githunguri Dairy Co-operative Society's 11,300 farmers delivered 81 million litres of milk. [Sammy Omingo, Standard]

Milk production by farmers from Githunguri Dairy Co-operative Society has dropped by 2 million litres amid the rising cost of production.

This year, the society's 11,300 farmers delivered 81 million litres of milk compared to 83 million litres the previous year, a drop that has been attributed to animal disease and the high cost of inputs.

This, coupled with unpaid debts from at least five collapsed supermarket chains, and high cost of power, has left the milk producers facing a bleak future of what was once a thriving agricultural venture.

Chairman George Kinuthia said the cooperative society that is famed for its flagship ‘Fresha’ milk products is diversifying its operations to cushion farmers from skyrocketing cost of power, petroleum and raw materials.

Speaking during the society's 60th annual general meeting held virtually, Mr Kinuthia attributed the low production to lumpy skin and foot-and-mouth disease, which has led to the death of animals and decreased milk production.

"Currently the cost production has reached an all-time high, with power bills hitting Sh7 million monthly. This is besides the high price of diesel and petrol, which has made things really tough for farmers," the chairman said.

The price of animal feeds, he added, has also affected farmers’ incomes, with inputs like dairy meal retailing at Sh2,500 a bag currently, up from Sh1,800 previously.

Matters got worse following the collapse of at least five supermarket chains which owe society nearly Sh200 million in supplies.

Kinuthia said the debtors included Tuskys (Sh68 million), Nakumatt (Sh45 million), Uchumi (Sh44.5 million), Saltes Supermarket (Sh18.6 million) and Naks Superstores (Sh16.9 million).

The chairman asked the government to intervene and reduce the payment period for deliveries to supermarkets from one month to a week to avoid situations where suppliers lose their money when these companies fold up.

However, despite the tough times the society which marked its 60th anniversary this year, managed to register a turnover of Sh8.1 billion from the previous year's Sh7.6 billion.

Kinuthia also said in order to improve farmers' earnings and cut production costs, the management has embarked on various ventures including the construction of an animal feed factory and the installation of solar panels among others.

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