Processor puts smiles on the faces of dairy farmers

It may not be playing in the same league with the big boys of Kenya’s dairy industry such as Brookside, New KCC and Githunguri Dairy at least for now.

But barely nine months after it ventured into the pasteurized milk market, Mukurwe-ini Wakulima Dairy is causing ripples.

With over 70 distributors in Nairobi County, its main market, the firm is giving established rivals a run for their money.

“We want to stamp our footprints in this competitive market by growing our volumes and enabling our farmers to maximise on their efforts while at the same time eradicating poverty,” said general manager, Mr Fredrick Muriithi.

For the group of peasant dairy farmers, who started as a self-help group and could hardly transport their produce to the market, theirs is a story of tenacity, their dream has finally come true — after waiting for 25 years.

Today, Royal fresh milk processor has a fleet of vehicles. The company, which could not dare step into any financial institution as it was dismissed as credit unworthy, has an investment asset base of Sh200 million and is attracting many lenders as its investment portfolio rises steadily.

FARMERS SACCO

“Today, we’re able to service a Sh90 million loan from CFC Stanbic Bank that has enabled us to put up a modern plant with a capacity to process 100,000 litres of milk per day but due to the prevailing drought, we are only processing 24,000 litres daily,” said Mr Muriithi.

Apart from the lenders, who want to partner with the processor, Nyeri County government has also stepped in, pumping Sh26 million into the firm.

“With this kind of assistance from Governor Nderitu Gachagua, we have elaborate plans to expand our production and in the next four months, we shall be producing yoghurt, ghee, butter and cheese,” said Mr Muriithi.

The company has also attracted assistance from Agriterra, a non-governmental organisation from the Netherlands, which has trained its staff on extension services, animal husbandry besides good governance.

With a view to help the local farmers, Mukurwe-ini Wakulima Dairy has scored another first by establishing Wakulima Commercial Savings and Credit Society where over 6,000 milk suppliers access cheap loans.

According to the chief executive officer John Mwaura, the Sacco has been rated as one of the best in Nyeri County for the last five years in a row. Last year, the Sacco’s 17,000 shareholders were paid a dividend of Sh6.5 million.

The company has increased its investment portfolio by constructing a four-storey administration block besides a modern laboratory for testing the quality of milk.

“Dairy industry is very sensitive and we have employed qualified personnel, who test the milk at the collection point. The company laboratory makes sure that we maintain the best industry practices as we grow our business,” added Mr Muriithi.

The processor’s plan is to transform Mukurwe-ini sub-county into a metropolitan within Nyeri County and towards this end, it has employed 11 university graduates, 38 diploma holders and a number of certificates holders from the Rift Valley, eastern and western parts of Kenya, making up a total workforce of 133 from the initial four.

QUALITY CONTROL

But it is the company’s focus on the farmers that has seen it win the hearts of many and today apart from its core suppliers in Mukurwe-ini, the company is attracting dairy farmers from neighbouring Tetu, Mathira and Othaya.

“We pay our farmers Sh33 per kg and apart from the prompt payment, we have opened a food store where the farmers buy wheat flour, maize flour, sugar, tea leaves among others on credit,” said Mr Muriithi.

The company has also put up an animal feeds factory and a veterinary services arm where dairy farmers get Artificial Insemination services for their stock.

“One of the main reason for poor milk production is substandard animal feeds and that is why we put up a plant, where we control quality and this has paid dividends. Our farmers get quality feeds at a subsidised and affordable prices, which translates into increased milk production,” he said.

But what has been the processor’s success secret? “We rally the stakeholders and make sure they are focused and believe in the company’s vision. When every player knows the path of success, turning the company into a profitable cash cow becomes the easiest thing to accomplish,” said Mr Muriithi.