Dairy farmers to get over 30% more income with new milk prices

A dairy farmer will get Rwf100 or 30 per cent more income per litre of raw (unprocessed) milk through the enforcement of a new minimum price set by the Ministry of Trade and Industry (MINICOM). According to a public announcement issued by MINICOM and signed by the Minister of Trade and Industry, Prof. Jean-Chrysostome Ngabitsinze, the minimum price of raw milk delivered by dairy farmers to milk collection centres (MCCs) is Rwf400 per litre. This is higher than Rwf300 a litre that was set in August 2022 and was still applicable until the new price was announced. The statement indicated that dairy farmers having contracts to supply raw milk at a price higher than the above prices are not concerned with this announcement. It added that the price at which milk is bought from MCCs is Rwf432 per litre. The price, it showed, was set after an assessment of the cost of production conducted by the Ministry of Agriculture and Animal Resources (MINAGRI) in collaboration with the Ministry of Trade and Industry and other stakeholders in the milk value chain. Also, it pointed out, a reference was made to the recommendations of the consultative meeting held on July 8, 2024, which convened all relevant stakeholders. Samuel Kayumba, a dairy farmer from Nyagatare District of Eastern Province, told The New Times that the new price is an encouragement for farmers and the dairy sector growth at large. “We are happy with the Rwf400 [a litre of milk] because it will contribute to further developing the dairy sector. It means an improvement in a dairy farmer’s income,” he said, adding that it is likely to contribute to increased milk production through encouraging investments in the dairy sector. He said some people were discouraged to invest in the dairy sector because of the low milk price per litre. Meanwhile, he said that milk availability has gone down during this dry season, giving an example that he was supplying about 50 litres per day in April and May which is the rainy season, “but now [in July] I supply like 30 litres per day because of the dry season. This is the case because during the dry season, there is reduced availability of grass/fodder as its growth is inhibited by drought. Also, water access is limited and some dairy farmers opt to take water from distant places where it is available to their farms. This results in increasing the cost of production for dairy farmers. Laurence Kayumba, a dairy farmer in Gicumbi District, Northern Province, said that the decision to increase milk price was the right one in terms of protecting farmers from incurring losses during this period when the prices of livestock farming inputs are higher, citing costs of labour, and feed. She also pointed to reduced milk production due to the current dry season. “It is good that the government considered increasing milk prices especially during this period where dairy farmers have limited access to fodder and water. In fact, cow feed is expensive,” she said, pointing out that the new price is a boost to dairy farmers’ efforts towards increasing milk production. Cassien Karangwa, the Director of Domestic Trade at the Ministry of Trade and Industry, told The new Times that since August 2022 when the previous price was set, changes were observed in terms of what dairy farmers need for milk production, citing increase in cow feed prices, veterinary drugs, and cost of labour, and particularly, the dry season that causes a lack of grass for cows’ consumption. “The price will help dairy farmers to be able to feed or take care of their livestock [cows] so that we continue getting the milk produce we need,” he said. Rwanda’s annual milk production steadily increased from over 7.2 million litres in 1994 to more than one million tonnes (one billion litres) in 2023, which implies that it increased 138-fold within the last 30 years, according to data from MINAGRI.

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Dairy farmers to get over 30% more income with new milk prices