CS Munya directs New KCC to buy milk at Sh33 a litre

Wednesday, January 15th, 2020 00:00 |
Dairy farming. Photo/Courtesy

Nicholas Waitathu and Anthony Mwangi

AGRICULTURE:  Dairy farmers will immediately start benefitting from a raft of measures President Uhuru Kenyatta put in place after the government increased farm gate prices from Sh26 to Sh33 per litre.

The move which targets farmers affiliated to the New Kenya Cooperative Creameries (NKCC) is, however, expected to trigger price hike in the market from other dairy processors.

Newly appointed Agriculture Cabinet Minister Peter Munya, who yesterday hit the ground running, directed the government owned sponsored dairy processor to improve prices.


“Following the directive by President Uhuru Kenyatta on Tuesday this week that National Treasury to release Sh500 million to NKCC to enable it purchase excess milk from farmers to convert it into powder milk for future use, we have agreed with the company to increase farm gate prices by about 18 per cent to cushion farmers against the current glut in the market,” he said.

Speaking during his first press conference at his Kilimo House, Nairobi, Munya explained that the Sh33 price tag was derived following an analysis of the current quantities and processing capacity.

“Our duty as a government is to protect the small scale farmers against inefficiencies in the market. We uphold competition market regulations and thus we cannot apply unethical business tactics,” he added.

Munya denied accusations that Government is distorting the market by setting new prices which is prohibited under the competition laws.

During the press conference Munya also briefed media on the locusts invasion and ongoing control measures being put in place countrywide.

He also announced that coffee farmers will start receiving payments for their produce from the New KPCU which will for the first time be digitised to fast track the process, adding that coffee farmers will be paid 40 per cent of their produce or Sh20 per Kg, money which will come from the Sh3 billion Revolving Fund announced by Uhuru on Tuesday.

Munya also disclosed that amendments have already been crafted to regulate coffee cooperatives.

He said most societies were formed to rip-off poor farmers.


“The proposed law seeks to establish how many members are required for a cooperative to be registered,” said Munya.

Munya said that the government has banned millers from importing rice and instead directed that they buy from local farmers through the Kenya National Trading Corporation. “Cheap products have flooded the market,” he said.

Addressing the ills facing the tea industry, he said regulations will be put in place to licence only those brokers that add value before exporting tea.

He, however, said that the government will provide a common user facility to support small scale dealers who lack the capacity to add value to their tea.  

More on Finance and Investments


RECOMMENDED STORIES Finance and Investments