Here’s our plan to meet milk demand, New KCC chief talks

1.Let’s deal with the elephant in the room first. What is your take on the recently suspended Kenya Dairy Board bill?

The bill has progressive amendments on quality management, which is critical for the health of the customers. However, there is need to relook at levies at the entire value chain to avoid making dairy uncompetitive.

2.Farmers feel oppressed and exploited. You must be privy to the price wars between farmers and milk processors, at how much does NKCC buy a litre of milk from farmers and why not fix this once and for all?

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The cost the farmer incurs to produce a litre of milk is Sh36, while the selling price for a 500ml packet is Sh50 shillings which might seem like a huge gap but the difference is brought about by the cost incurred during the production process. The production cost takes up 42-45 per cent. We also have processing, marketing and distribution and administrative costs to meet. We give them out best.

3.Most parts of the country have experienced a drought which means we might experience a milk shortage, what measures has NKCC put in place to ensure customers continue to enjoy their brands of choice?

We are already experiencing a 40 per cent decline in supplies as there is a decline in milk production across the country due to a pro-longed dry spell which has caused scarcity of animal feeds and water. We are currently training farmers on feed preparation and conservation. We have also started reconstituting the powder milk in our reserves to ensure that customers have a continuous supply of milk and so that we maintain stability of milk prices at the consumers end.

As we also know that the dry season comes with many challenges, we are offering extension services to farmers. Extension activities key in raw milk procurement plus we get to understand farmers needs first hand. Some of the key services we offer include training, feeding programmes, AI services, transportation of milk and financial support.

The biggest challenge in the dairy industry is the current average production of 7 litres per cow which through ourfeeding programme we hope to push to 15 litres as feeding plays a crucial role in milk production.

4.There’s too much milk from Uganda in the market...what is NKCC doing about this?

Cheap imports from Uganda are a threat to the sector. This poses a great competition to us.

5.What are some of the things NKCC is doing to ensure to cushion itself against challenges the cooperative went through before?

We have just completed the modernisation of our four factories in Nyahururu, Sotik, Eldoret and Dandora. Our second and final phase will cover Kiganjo, Kitale and Miritini plants. The mordenisation programmes have benefits for the farmers and consumers as we have increased our holding capacity to 1.5 million litres of milk per day and process up to 800,000 litres through cooling, pasturising and packaging.

Once we complete the final phase, we will end up processing 1.2 million litres per day. Once we complete the mordenisation programme, we will cut down on cost of production and increase efficiency that will help stabilise the glut and shortage periods. We have already spent Sh1.1billion in the upgrade programme.

6.How much does NKCC make in a year and how much goes to farmers?

With modernisation of NKCC factories, the business has attained a turnover of more than Sh10 billion and farmers’ payout has increased from Sh2.5 billion to Sh5 billion. 

7.What new technologies/ new ideas to enhance efficiency and good relations with farmers?

The major challenge in milk production is breeding and feeding since most of the farmers depend on rain-fed agriculture. We are putting in place various mitigation measures which include a strong base of farmer extension programmes. The focus is on feed production, conservation and breeding. We help farmers understand the season variations and how to plan for each season appropriately in order to ensure stable milksupply.

We have put in place feed store in our facilities where farmers can access feed through a check-off system. 

We also conduct exchange programmes to expose farmers to modern dairy farming technologies, feed production and nutrition. For our farmers to compete in the international market, they must be in a position to produce quality milkwhich boils down to nutrition management.

8.What is NKCC market share in the currently? 

Our market share has risen steadily from 23 to 35 per cent. Our main competitors, Brookside stands at 40 per cent, while Githunguri Dairies stands at 10 per cent.

9.What is NKCC doing to encourage the youth to venture into dairy farming?

We are working on this and we hope to recruit more youth into dairy farming. We expose those interested to latest technology on dairy management. We are also educating them on the benefits of dairy, and the fact that dairy does not require too much land to invest in. 

10.Accessing credit is a great challenge to farmers, what are you doing about this?

We do offer financial services to our farmers by linking them up with financial institutions that we have partnered with. 

11.How doe the future for dairy look like?

Compared to other sectors, dairy has been growing and doing well in the past five years. We can go far but we must be ready to tackle some of the challenges we are facing such cheap milk imports and poor quality feeds.

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