Murang’a Creameries sinks Sh1.5bn dream
Residents of Murang'a town buy milk in 2019 at a milk ATM established by the county government.
What you need to know:
- Governor Irungu Kang'ata announced on Wednesday that the factory was no longer functional.
- It also has Sh400 million worth of outstanding bills.
The Sh300 million Murang'a County Creameries (MCC) that was the hallmark of former governor Mwangi wa Iria's administration has been pronounced dead, dashing the hopes of 45,000 dairy farmers.
Governor Irungu Kang'ata announced on Wednesday that the factory was no longer functional. It also has Sh400 million worth of outstanding bills.
"These outstanding bills were for various items, including supplies and outstanding payments for milk deliveries by farmers. The county government has now referred the case to the county assembly for deliberation and guidance on the way forward," he said.
More painful for the residents, who have now lost more than Sh1.5 billion on the project, is the fact that chang'aa traders in the county are now brazenly claiming the plant so that they can use it as a legal distillery.
Among the cash hemorrhages that came with the plant were Sh300 million in subsidised artificial insemination services, Sh200 million for an animal feed processing plant and Sh100 million in vines and napier grass given to farmers to boost milk production.
Also lost with the death of the MCC were job opportunities for over 100 people and the collapse of the One Family One Cow project, which was estimated to be worth Sh800 million.
In 2015, dairy farmers were elated when Mr Wa Iria announced the procurement of 65 milk coolers to extend the shelf life of the milk supplied.
He then organised dairy farmers into cooperatives and imposed a minimum return guarantee of Sh35 per litre of milk, which improved the farm-gate price from Sh10.
In 2019, Mr Wa Iria rolled out the MCC processing plant in Maragua town, shining a brighter light on the 200,000 litres of white gold that farmers in the area produced on average every day.
The plant began packaging the milk and entered the race for market share, capturing 58 per cent of the district's market.
As yields improved, Mr Wa Iria adjusted the price per litre payable to members to Sh43 by 2022 and Sh2 per litre as a bonus.
The MCC made Mr Wa Iria so famous that he harboured ambitions of contesting the 2022 presidential election, as Mt Kenya counties were jealous of the Sh5.6 billion annual dairy industry he had created.
The counties would send their farmers, accompanied by their MCAs, to Murang'a for lessons on good dairy practices.
As politics took centre stage, the societies suddenly withdrew from the MCC and started taking their milk to private processors.
The Senate Committee on Tourism, Trade and Industrialisation also sent questionnaires to the Wa Iria regime demanding answers about the MCC and issued several summons to appear before it, which the governor ignored and was fined Sh500,000 for defiance.
The MCC became unviable by July 2022 and it has now come to pass that it is structurally dead and it is not even clear who owns it as no share quotas have been allocated to member companies who have in any case withdrawn their membership.
However, Mr Wa Iria insists that he has left behind a fully functional MCC with a capacity of 800,000 litres per day and a storage capacity of 200,000 litres, making the plant's capacity 1 million litres and the largest in the region.
Mr John Kiruru, a repeat offender at the Chang'aa distillery in Maica Ma Thi village, told Nation.Africa on Monday that "the governor should consider handing over this plant to us so that we can earn an honest living distilling and packaging our brews in a safe, legal and rewarding manner".
He said the brewing of chang'aa, like all other traditional brews, was not illegal if licensed and subject to quality standards.
He claimed that Murang'a has over 50,000 illegal brewers who can regularise their livelihoods by sharing tasks that can produce clean brews from local horticultural crops and open a distribution chain that will make the county rich through jobs created and revenue generated.
Dr Kang'ata said a report on the way forward would be made available to the public by June 15 and implementation of its contents would begin in October 2023, subject to the National Treasury disbursing funds to the county.
MCC founding chairman Julius Maina said "MCC is sentimental to the dairy farmers in this place and the dream and hopes it carries should not be abandoned for any consideration".
He said MCC was the mother of the Murang'a dairy reforms and had it been managed prudently, it held immense opportunities for employment, both national and county revenue as well as diversification into juice and wine production.
