Ruto Orders Sh65 Milk Price as Kenyan Consumers Brace for Higher Costs

Kenyan households could face another squeeze on their food budgets after President William Ruto announced a new minimum price of Sh65 per litre for milk supplied by dairy farmers.

The new rate, which took effect in October 2026, represents a Sh5 increase from the previously announced Sh60 per litre.

Farmers will also receive a quarterly bonus of Sh2 per litre, according to the President.

While the move is designed to improve earnings for dairy farmers, it could have consequences beyond the farm gate.

Processors and retailers may face higher raw-material costs, potentially creating pressure for retail milk prices to rise.

The announcement comes at a difficult time for Kenya’s dairy industry.

Prolonged dry conditions have reduced pasture availability and increased the cost of animal feeds, while milk deliveries to formal processors have also come under pressure.

Kenya Dairy Board figures cited in recent reports show formal deliveries falling from 84.4 million litres in June to 81.3 million litres in July 2026.

For consumers, the timing could be particularly uncomfortable.

Fresh milk prices have already been affected by supply constraints, with some supermarkets reporting shortages and limiting the quantities customers can purchase.

In September, some outlets were selling fresh milk at more than Sh60 per litre, while long-life milk was also trading at elevated prices.

However, the higher farm-gate price does not automatically mean consumers will pay Sh5 more for every litre.

Between the farmer and the shopper are collection centres, cooling facilities, processors, packaging companies, transporters and retailers, all of whom add costs along the supply chain.

The government argues that improving returns to farmers is necessary to strengthen the dairy sector and encourage higher production.

Kenya produced about 5.5 billion litres of milk in 2025, according to the 2026 Economic Survey, while marketed milk rose by 11.5 per cent to about one billion litres.

The bigger challenge, therefore, is ensuring that increased production reaches consumers efficiently and consistently.

If farmers earn more but production and distribution remain constrained by drought, expensive feed and supply-chain inefficiencies, shoppers could ultimately shoulder part of the additional cost.

For millions of Kenyan families who rely on milk every day, the Sh65 policy could become a test of whether better farmer earnings can be achieved without making an essential household commodity increasingly unaffordable.

https://peopledaily.digital/business/how-rutos-ksh65-milk-price-could-push-up-costs-for-kenyan-consumers?fbclid=IwY2xjawVFkeNleHRuA2FlbQIxMQBwZG9mBXNydGMGYXBwX2lkDDM1MDY4NTUzMTcyOAABHkmmsWNMcEx3DkddhPDh1tWmZbhe6E385syWf273h4lNAtVnIlt30hmwP7xa_aem_43G6Ue2mce1vU6D9GdeDtw

smmdigita.com feedback-opera-news-app@opera.com