Milk prices to rise as regulator slaps farmers with new levies

The Kenya Dairy Board (KDB) has set maximum deductions dairy cooperatives should deduct from farmers delivering raw milk in a bid to secure stable and reasonable prices to producers.

This move comes after the Agriculture Cabinet Secretary Peter Munya directed cooperatives and other entities procuring milk from farmers to ensure the new directive is effected.

KDB Managing Director Margaret Rugut Kibogy, in a circular, directed the cooperatives to ensure it deducts a maximum of Sh2 per litre to cover administrative costs while dealing with raw milk.

The firms were further directed to deduct Sh1 per litre to cover chilling cost, Sh2 per litre to cover transport cost and Sh0.40 per litre for Kenya Dairy Board levy fee.

“In line with these directives and in accordance to the provisions of the dairy Industry (Sale by Producers) Regulations 2004, you are required to comply with the aforementioned requirements with immediate effect,” said Ms Kibogy in a circular letter dated February 12.

Ms Kibogy warned that failure to comply with the requirements will lead to enforcement of clause 9 of Dairy Industry which may lead to suspension or cancellation of licence.

“The Kenya Dairy Board Inspectors will be visiting your premises to monitor compliance and take any necessary remedial action,” said Ms Kibogy.

She urged the industry players to cooperate with the board to ensure stability of the sector.

However, this new directive was met resistance from some milk producers who accused the government of failing to involve them before making such drastic action.

“The spirit of public participation should have applied here and the government should stop behaving as if it is the police, prosecutor and the judge when it comes to issues involving producers,” said a chairperson of a Cooperative Society in Dundori, Nakuru County.

Another producer in Bahati lamented that the cost would be passed to dairy farmers and this would reduce earnings from milk.

“The prices of milk are oscillating between Sh30 and Sh33 and as producers, we feel this increase was uncalled for because milk prices have not stabilised,” said an official who requested anonymity.