President William Ruto has announced that dairy farmers will be paid Ksh65 per litre of milk starting this month, with an additional Ksh2 per litre paid as a quarterly bonus.
Ruto made the announcement on Tuesday, October 20, during the 63rd Mashujaa Day celebrations at Kipchoge Keino Stadium in Eldoret, saying the new rate was part of government efforts to improve farmers’ earnings.
“Beginning this month, dairy farmers will earn Ksh65 per litre with a bonus of Ksh2 to be paid every quarter,” he said.
The President said the price paid to farmers had previously increased from Ksh35 to Ksh60 per litre, with the latest adjustment expected to raise their income further.
He also said milk production in the country had grown by one billion litres.
Milk shortage pushes prices up
The development occurs in the wake of shortages of milk that had been facing consumers and businesses.
The shortfall has been attributed to the expensive nature of animal feed as well as low milk production levels. Some farmers have even decided to market their milk directly to consumers due to higher returns compared to those provided by processors.
According to the KNBS Economic Survey 2026, fresh milk production stood at 5.5 billion liters in 2025, indicating an increase of 3.5 percent against the previous year.
According to the survey, milk consumed by industrial processors exceeded one billion liters for the first time with an increase of 11.5 percent from 909 million liters in 2024.
The increase in the paying level will benefit the farmer community, but the government still has the challenge of tackling the milk shortfall without making consumers incur additional costs from the higher prices of the commodity.
Government plans changes at New KCC
Ruto’s announcement follows plans to decentralise the eight factories operated by New Kenya Cooperative Creameries (New KCC).
Under the proposed changes, each factory would operate independently and supply milk directly to markets within its region.
The government says the arrangement is intended to reduce reliance on the Nairobi factory for distribution and cut transportation costs. The changes are also expected to help improve milk supplies and bring down prices for consumers.
The President further pledged to pay dairy farmers approximately Ksh400 million owed to them by the end of October.
