A litre of milk now costs as much as Sh85 in Nairobi estates. President William Ruto’s answer is to look beyond the cow. Speaking Friday at the close of the three-day Agriculture and Food Systems Transformation Summit 2026 at Jamhuri Showgrounds, Ruto urged Kenyans to diversify their milk sources. “We need to diversify our source of milk, from camels, sheep, goats and even from buffaloes,” he said, drawing laughter when he mentioned buffaloes.
The joke landed. The prices didn’t.
The Price Squeeze
A Daily Nation spot check found milk selling for Sh85 a litre in Kasarani, Githurai, Zimmerman, Kayole, Buruburu and Embakasi. In Zimmerman, it cost Sh75 before the shortage. Supermarkets and milk ATM dispensers in residential estates have all raised prices. Ruto, a farmer himself, said drought had cut cow’s milk supplies by reducing production.
The government’s messaging hasn’t been entirely consistent. Agriculture and Livestock Development Cabinet Secretary Mutahi Kagwe played down claims of a shortage in an interview this week with Fixing the Nation, describing a decline in supply instead. He said the government would continue talks with dairy cooperatives and processors about the sector’s challenges.
Kagwe also acknowledged that farmers’ take-home pay varies. Some earn between Sh50 and Sh53 per litre, while others get up to Sh55, depending on their cooperative or processor. He called for efficient cooperative management and fair returns. Consumers pay Sh85 at the end of a chain that gives farmers a little over half that amount.
State-Led Fixes
Ruto directed Principal Secretary for Livestock Development Jonathan Mueke to speed up the search for improved camel breeds. He said expanding camel milk production would require investment in pastoralist communities, where people keep the animals and hold the traditional knowledge needed to support the value chain. Camel milk, long associated with arid and semi-arid areas, already sells in urban centres including Nairobi. Pastoralists, he said, need help increasing production and reaching those markets.
On dairy reform, Ruto said changes at the New Kenya Cooperative Creameries aimed to raise farmers’ earnings and ensure they receive payment on time. “Farmers should not have to wait two or three months to receive their money,” he said. He credited government measures, including subsidised fertiliser, with raising national milk production from 4.5 billion litres to 5.5 billion litres over the past three years, making Kenya Africa’s largest milk producer.
The claim sits awkwardly beside the shortage. Subsidies may have lifted output on paper, but shelves and dispensers tell a different story this month.
Tea, Coffee and a New Facility
Ruto said tea reforms were also paying off. Production has risen by 50 million kilogrammes, he said, while payments to farmers for green leaf have climbed from an average of Sh16 per kilogramme three years ago to about Sh30 this year. The government has mobilised Sh1.55 billion to modernise selected tea factories, with Sh850 million available for further improvements to raise efficiency and narrow disparities in farmers’ earnings.
Ruto also announced approval of 50 acres at the Dongo Kundu Special Economic Zone for the Kenya Tea Development Agency to build a tea value-addition facility focused on higher-value products and export markets. The government has given Kenya Tea Packers Sh100 million to modernise its processing facilities.
The Absorption Problem
Tharaka Nithi Governor Muthomi Njuki, vice-chairperson of the Council of Governors, brought a warning from the field. Subsidies on fertiliser, certified seeds and artificial insemination had boosted production, he said, but markets and processing capacity in some areas struggled to absorb the increase. “We need to strengthen markets, processing and value addition so that increased production translates into better incomes for farmers,” Njuki said. He urged the government to implement the AgriConnect Compact without delay.
World Bank Director Qimiao Fan said the bank was in advanced talks with the government on a multi-year, multisector programme covering farming, agribusiness, irrigation, rural roads, research, extension services and digital infrastructure. “Boosting agricultural production alone will not deliver transformation unless it is accompanied by improvements in transport, energy, processing, finance and market access,” he said. The bank has committed to lifting global annual financing for farming and agribusiness to $9 billion by 2030 and mobilising another $5 billion from the private sector.
Ruto said agriculture contributes about 50 per cent of GDP when wider linkages are counted, and described the reforms as a shift from subsistence to a commercially driven sector. He also warned cartels against grabbing public land reserved for fisheries, saying authorities have gazetted all 41 fish landing sites along the Coast as government facilities. A marine centre of excellence at the Coast National Polytechnic cost about Sh600 million.
Why This Matters:
Kenya’s milk episode shows what happens when subsidies lift output but the rest of the chain falls behind. Governor Njuki and the World Bank’s Fan made the same point from different directions: production gains mean little without processing, transport, finance and market access. Consumers paying Sh85 a litre while farmers collect Sh50 to Sh55 are seeing a distribution and pricing gap that more state programmes might not close. The pending World Bank package and new KTDA facility will test whether public money can draw in private investment rather than replace it. Taxpayers, farmers and shoppers will want results measured in prices and payments, not production totals.