Brookside Dairy will start paying farmers based on milk quality as it seeks produce that allows it to manufacture more premium products like ghee and butter.
Brookside Dairy executive chairman Muhoho Kenyatta said the move would boost the supply of high-quality milk that would enable the processor to tap a larger share of the high-value products that deliver premium prices.
“This reward scheme is about quantity and quality akin to a cheque for the amount of tea delivered to a factory and a bonus at the end of the year,” he said.
The quality-based pricing model will be influenced by the amount of butterfat in a kilogramme of raw milk, milk free from antibiotics and added water.
This is a shift from the current pricing model that relies on the weight of milk and does not fully reward farmers for high-quality husbandry.
The quest for milk with high-fat content in milk comes at a time when Brookside is seeking more revenues from products such as ghee and butter as well as yoghurt and sour milk.
Mr Kenyatta said the premium payments for raw milk would prompt farmers to boost their investments in dairy farming.
Premium products such as ghee and butter are fast emerging as a healthy option at a time when food choices are becoming a key consideration among Kenya’s urban population.
More households are turning to ghee over salad and vegetable oil while some opt for butter instead of margarine.
Milk procurement and manufacturing director John Gethi said the new pricing would be based on an agreement with their contracted farmers on the amount of extra money to be paid out per litre based butterfat content.
The Brookside also launched a bonus scheme to reward farmers who surpassed the delivery targets as firm races to tap more raw milk against rivals like New KCC.
On Wednesday, it paid Sh100 million as a bonus for milk delivered in the nine months to September.
The Kenyatta family owns half of the dairy firm. Founded in 1993 in Kenya, Brookside also exports to Uganda and Tanzania.