This archive report was first published on 14 December 2019.
As East Africa enters a decisive phase of economic integration, the recent milk price plunge in Kenya serves as a timely reminder of the need for transparency and cooperation in regional trade.
Next week, a Kenya government delegation will visit Uganda to verify the authenticity of milk entering the Kenyan market, following concerns over a sharp jump in Ugandan milk imports.
The visit comes after Kenyan farm-gate prices for a litre of milk crashed down to Ksh19 ($0.19), sparking fears of a trade dispute in the region.
Uganda, which struggled to produce enough milk for its own consumption just over a decade ago, is now suspected of laundering milk from other sources, a claim reminiscent of the sugar sector scandal.
However, experts argue that the dairy sector is undergoing a natural evolution, with the region approaching a more stable supply of raw milk.
Uganda's Dairy Development Authority reports that the country produced 2.8 billion litres of milk in 2018, with 2.4 billion litres logged by June this year.
Kenyan political leaders are crying foul over the plummeting prices, but the price in Kenya is at least Ksh8 ($0.08) above what Ugandan cattle keepers are earning from their milk at the farm gate.
As East Africa moves towards vertically and horizontally integrated value chains, it is essential to give the process a chance, despite potential challenges and disruptions.
