Dairy Farming

The agricultural sector is the backbone of the Kenyan economy as it contributes to around 25% of the GNP and employs 75% of the labour force. The livestock sector numbers around 13, million cattle, 22 Million sheep and goats and 1 million camels. Besides that there are on average about 350,000 pigs and 25 million chickens.

  The livestock sub-sector contributes 10% to the GNP of which 3.5% originates from the dairy sector. Total beef and milk from cattle are estimated on 320,000 MT and 3million MT per annum respectively. The fast majority of the beef is produced by the pastoral system in the ASAL areas providing livelihood for about 3 million people. Small-scale farmers in the high potential areas produce 75% of the cattle milk. Their number is estimated between 6 and 700,000.

  The main constraints in the dairy sector are in the field of animal husbandry, supply of inputs and services including credit and milk marketing.

  The Kenyan livestock sector used to have a reasonably well-established infrastructure. Unfortunately the quality of this structure had eroded during the nineties and has not been adapted to the changing situation, with thousands of small-scale farmers and increased attention for the ASAL areas. The Government puts in a lot of effort to change the situation. Increased output of the livestock sector will be achieved by further commercialisation, improved security and infrastructure, adequate supply of inputs and services and value addition in production areas where possible. This in combination with production systems based on sustainability and conservation of the natural environment.

  The legal framework to govern the livestock sector is organised as follows:


 2.1 Ministry of Livestock and Fisheries Development (MoLD)

  The main functions of the MoLD include development of livestock industry, range development and management, veterinary services and disease control, livestock production and extension services, development of fisheries industry, development of bee keeping industry and hides and skins.

Appropriate institutions under the Ministry include:

 2.2 Kenya Dairy Board

  The main regulatory body in the dairy industry is the KDB, established under the Dairy Industry Act, Cap 336 of the Laws of Kenya. The Board is managed by a Board of Directors with a Chairman appointed by the Ministry. KDB has the responsibility of developing, promoting and regulating the dairy industry. The main functions of KDB are the enforcement of national standards for the dairy industry, training for the industry; facilitation of stakeholders’ activities; maintenance of a databank for the dairy industry and regulation of imports. In practice, KDB has largely been a reactive institution that has concentrated its efforts in policing the activities of milk hawkers and other unlicensed operators in the industry. This is to safeguard the cess, which provides nearly 80% of its revenue rather than acting in the interests of all consumers.

Almost 90% of the milk produced originates from cattle. Camel milk is produced and consumed in the ASAL areas, while some of it is marketed within Malindi, Laikipia and Isiolo as well as being sent directly to markets in Nairobi and Mombasa. The milk is sold at relatively high prices KES 60-70/L.

 Goats are kept in the high potential areas as well as in the ASAL areas. Goat milk constitutes about 4% of the total milk production. Trading in goat milk apparently is very little.

 Disposal and Marketing of Milk from Cattle

   About 70% of the cattle milk produced and marketed, being around 2.2 million MT. The milk remaining on the farm is used for human consumption and for calf-rearing. Around 70 % of the grade dairy cattle is kept on small-scale farms with on average 2 – 3 cows. Home consumption of milk is estimated on 2 L per family per day. The situation with few animals per farm and a considerable home consumption is one of the major factors explaining that around 1/3 of the milk produced remains on the farm. The predominance of raw milk sales, which account to 86% of the total marketed milk.

A large proportion of the raw milk sales goes via a large group of informal vendors (commonly referred to as ‘milk hawkers’). They deliver non-processed milk directly from the farmers or via the dairy co-ops to consumers, especially in the urban and town centres. Hawkers pay the farmers a price comparative to the processors or societies or even a bit less. Since they usually practice ‘payment on the spot’ farmers are willing to accept a bit lower price. Hawkers sell the milk directly to consumers in the urban areas and towns.

Marketing of Processed Milk

The dairy processing industry in Kenya makes a range of products including pasteurised milk, drinking yoghurts (plain and flavoured), cultured milk (mala), UHT whole milk, low-fat and flavoured, butter, a whole range of cheeses, full cream and skimmed milk powder and ghee. Since the liberalisation of the milk processing in 1992 the variety of products, ways of packing and size of content has increased tremendously


  The liberalisation of the dairy industry was accompanied by policy changes that led to considerable Changes in institutional aspects of the dairy sub-sector, including increased private sector participation and government divestiture. Such services as Artificial Insemination (AI), veterinary clinical services and tick control (dipping) were liberalised in 1991 and handed over to the private sector, farmers’ organisations or the community.

  The removal of the government supported services led to the decline in the performance of the dairy industry because the private sector was not well prepared to take over and the majority of the farmers could not afford to pay for the more expensive AI, dipping and clinical services. Indeed, many of the farmers reverted to the use of bulls for breeding purposes, thereby leading to a decline in milk productivity.

  In 1992, milk marketing was liberalised. This policy change effectively ended the monopoly in milk marketing in urban areas and prompted the KDB to start licensing new processors and other dairy industry players. Liberalisation resulted in an influx of sales of raw milk, especially in urban areas. The Dairy Development Policy of 1993 addressed the challenges posed by the liberalisation reforms including a smooth exit of government from the provision of some of the government supported services, intensification of dairy production systems, increasing production in non-traditional areas, and opening up milk processing to new investors.

 From the Managing Director's Desk

  As you may all be aware the both dairy industry and cereals sector have been on the spotlight due erratic supply conditions arising out of unreliable weather conditions. This has affected the entire supply chain worst affected being farmers and the consumers.

  We at Classic Foods are happy to report that both our customers and farmers continue to benefit from our partnership. Through our partnership with Enhance Business Solutions, we have been able to provide training programme to farmers at the same time offer market for the surplus produce. We continue to enhance food security for the nation and create wealth for the community through provision of training on best farming methods, provide seeds, storage and best prices for the produce.

  We plan to expand the production of healthy food products as well as expand our product range. With our new facility at Juja-off Thika Road, we intend to serve the market in style and to enhance our presence in the local and regional market.Our partners, customers and farmers can expect a wide range of new and innovative products. We are confident of accomplishing our Classic Healthy Taste.With the growing campaign towards healthy eating  both locally and internationally, we are in the front line in employee development and we are committed to continuously upgrading the skills of our employees.We believe in interactive and real-time problem resolution and dialogue within our ranks as part of teamwork and employee development.At Classic Foods we are confident of delivering as per our promise. Look out for our brand.


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