dairy farming in Kenya 1 by 9N9T3x


Deneside Farm, Njoro
Presentation by Geoffrey Gicharu

                                   25 June 2012
Key questions to ask ourselves:
 Does Dairy Farming in Kenya have a bright future?

 Will Kenyan dairy farmers ever make money.?

 Despite all the donors and NGOs funding, (12 to 13 million
  US Dollars annually). Why are our farmers still poor?

 Is dairy farming sustainable?
      Challenges Facing Dairy
        Farming In Kenya
1. Increased cost of energy.

2. Increased cost of Feeds.

3. Uncertain weather patterns.

4. Farms are yet to fully recovered from the 2007 post
   election violence
               1. Cost of Energy.
Year   Price of Milk Per Liter (Ksh)   Price of Fuel Per Liter (Ksh)
1990   2.80                            0.92
1994   14                              10.83
1997   14                              25.90
1998   14                              28.80
1999   16                              39.20
2000   18                              48.50
2001   18                              48.50
2002   18                              39.50
2003   18                              39.00
2004   18                              54.90
2005   18                              58.00
2006   20                              60.00
2007   18                              63.75
2008   24                              88.49

2009   27                              69.45
2010   26                              86.93
2011   28                              117.70
2012   29                              106.00
                 Price changes in Milk vs. Fuel for the past 2 decades




                                                                                                  Price of Milk/Litre
                                                                                                  Price of Fuel/Litre



      1990 1994 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
2. Increased cost of animal feeds
•   High cost of Plant protein feed.
•   Less Cereals By-Products in Kenya.
•   High dependence of animal feeds (by-
    products) from the East African Region.
•   Future of animal feeds By-Products is not
     Price changes in Milk vs. Cotton Seed Cake for the past 2 decades




                                                                                                 Price of Milk/Litre
                                                                                                 Price of Cotton seed cake/Kg



     1990 1994 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
3. Uncertain weather patterns

   •   High temperature due to global warming

   •   Unpredictable weather patterns

   •   Frequent drought and crop failure

   •   Heavy Flash Floods
Farms have not recovered from the effects of post election
violence in 2007

•   After the post election violence in 2007
    transport costs, feed costs and other
    inputs have been going higher and higher.
•   Labour and labour costs has now become
    a major challenge
  Current Situation of the Dairy
        Sector in Kenya
 80% of milk production is done by the small scale

 Only 20% is by the medium and large scale farmers.
 Current Situation of the Dairy Sector
                in USA
 In 1940 – 20Million Milking cows averaging 2500kg
  per lactation in small holding farms averaging less
  than 50 cows/family.
 Today- 9.7 Million milking cows averaging 10000kg
  per lactation in large farms averaging 5000 cows per
       4. Kenya’s dairy situation is not
 80% - Small scale farmers /small holding.(less than
 20%- Medium and large scale farmers.

NB. The 80% small holding have no major
 investments and can therefore quit very fast.

   The 20% large scale can not come out dairying
    overnight because of high cost of investment over
    the years . E.g. machinery and infrastructure.
How are Farmers dealing with these challenges ?
     These challenges are now forcing/should be
     forcing farmers to;

1.   Shutdown

2. Keep more cows per unit area

3. Improve milk production per cow
The Gross effects of challenges facing farmers

 Our national herd size is shrinking very fast.

 Dairy business has realized slow growth compared
  to other businesses

 We have serious subdivisions of farms throughout
  the country.

 These challenges are also affecting processors -
  serious shortage of milk and jobs are being lost.
What the processors must do to remain in

•   It is time to consolidate their business

•   Prepare for milk production glut

•   Improve management

•   Review raw milk price upward/ match the
    hawker price
The future success of Dairy
For the sustainable success of dairy farming in Kenya, a
    team effort is required from the following parties:
1. Farmers
2. Government
1) The farmers must do the following;
a) Re-evaluate their production goals.

b) Need to reduce calve mortality and grow calves

c) Need to introduce other activities on our farms.

d) Need for farmers to own and manage their own milk
   processing plants.

e) Need to form co-operatives or partnerships
2) The Government must address the following;
a)   Formulate guidelines for the producer prices based on consumer prices percentage.

b)   Set the minimum produce prices of raw milk through KCC. E.g. its been done in
     cereal farming (Maize)

c)   The government must intervene though sub to save dairy farming from total collapse.
     Interventions have been carried out to (Pastoralists) in Northern Kenya.

         Funded purchase of livestock from drought affected areas.
         Free vaccination programs.
         Free supply of hay and water.
         Free Dam constructions.
         Tractors imported to assist land preparation .
         Importation of cheap fertilizer.

          The Government must urgently address underperforming institutions setup to
         support dairy farming in Kenya.
The 3 Key Government interventions to salvage
the sector

   Set up Raw Milk producer minimum Price/ Future milk
    producer prices to be based on % of the end user price

   Intervention to support medium and large dairy breeders in
    getting affordable sexed semen/ machinery/equipments,
    affordable Plant and Blood protein e.g. Soya and cottonseed

   More farmers involvement in the management of farmers
    support institutions.

Do dairy farmers have a future?

To all the stakeholders, I say YES. If we can work together as

   Each person in authority must work and do what he or she can
    do ,for tomorrow you may not have the opportunity effect
    good changes in the sector .

   The future success of farming in Kenya is in your hands.
       THE END
Questions & Comments ?

To top