10 January 2013

Kenya: Dairy Farming Attracts Interest in Nairobi Neighbourhoods

Nairobi — With the high demand for milk in Kenya, business entrepreneurs are investing in dairy farming in neighbourhoods across Nairobi.

James Muchiri, an investment adviser with Equity Bank in Kenya, said dairy farming is relatively inexpensive and there has been an uptick in interest in it in recent months.

"It does not require a huge piece of land and one can start with one or two cattle as they experiment with the market," he told Sabahi. "We have a stack of applications [pending approval] for these city dairy farm loans from individuals and groups that want to enter the business."

Equity Bank has been offering small loans with a five-year repayment plan to borrowers venturing into city farming, Muchiri said.

The government is encouraging this new trend because it creates jobs, said Nairobi's Dagoretti District Commissioner Cornelius Wamalwa.

Local government officials cannot estimate the exact number of dairy farms that are now in the city because most are operating as informal businesses and are not registered with the government.

But Wamalwa said it has become common for individual families to convert small parcels of land into dairy farms. "In Dagoretti neighbourhood, an average of three farms are sprouting up every month," he said.

In addition to milk, these small-scale farms are also meeting the high demand for poultry products, he said.

Local milk creates jobs, raises profitability

Cleophus Momanyi, a public health officer with the Nairobi Municipal Council, told Sabahi that most farmers invite health officials to help them maintain sanitation standards.

"We encourage farmers to monitor their animals for any symptoms of diseases and inform the veterinary officials," he said, adding that those who do not meet the standards are forced to shut down.

He said Nairobi city bylaws prohibit the keeping of livestock and poultry in the city. However, with the high unemployment rate, officials turn a blind eye on the trend as long as high standards of health are maintained, he said.

Simon Kiarie, a Kayole resident who used to sell milk transported from Kiambu district in Central Province, told Sabahi that he ventured into the business two years ago after realising he could make a profit.

"I saw a family who kept three dairy cattle on their small piece of land in Dandora neighbourhood and decided to start mine in mid-October 2010," he said. "The advantage of rearing the cattle here is that it saves me the transport and other labour costs I incurred while transporting the same milk from Kiambu."

Kiarie started off with two heifers worth 50,000 shilling ($577) each and now has 12 dairy cattle that produce an average of 200 litters of milk in a day, which he sells for 60 shillings ($.70) per litre.

He said he consults with government agricultural agencies for tips on increasing milk production.

Friends pool resources to start dairy farms

Mbuthia Kiragu said he went into business with 10 friends and neighbours in Dandora neighbourhood after securing a 500,000 shilling ($5,770) loan.

Before joining hands, the friends were construction workers and would work sporadically, making it hard to receive a stable income to support their families.

"We spent 250,000 shillings ($2,880) to acquire a piece of land measuring 70 by 50 meters in Dandora neighbourhood, a portion of which we used for the necessary infrastructure, and with the rest we bought four Friesian cows," he said. "Today we have 15 dairy cattle that can earn us more than 100,000 shillings ($1,153) in a month."

Today, they supply milk to neighbours as well as local hotels and schools. He said they have kits to test all the milk to ensure it is free from any disease-causing micro-organism like mastitis.

Kiragu says feeding and maintaining the sanitary conditions of the animals is very involved, but the satisfying returns keep them going.

"We are supporting our families now and we are planning to expand," he said. "There are bigger [operations] that have an income of more than 500,000 shillings ($5,770) and that is our short term goal for now. In the long term we want to acquire vast lands for bigger business."

There is always a market for milk, Kiragu said, adding that he and his neighbours are capitalising on dairy milk companies' inability to meet the demand.

There are also periods when the farmers experience milk surplus and prices drop. To increase the shelf life of milk and create greater returns, some small-scale producers venture into production of yogurt, said Onesmus Muturi, a farmer in Kayole neighbourhood.

Muturi told Sabahi that they pasteurise the milk at 85 degrees Celsius for at least 30 minutes to kill pathogens.

"We avoid exposing the milk to direct heat to preserve its original flavour. We package the yogurt and sell it for as little as 10 shillings ($.12) so that we can target even the low end market," he said.

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