Uganda’s milk exports to Kenya triple despite trade wars

Uganda’s exports of diary products to Kenya increased in the year ending June 2023 despite trader wars between the two countries.

According to the Uganda Dairy Development Authority (DDA) Annual Report for 2022/2023, the country exported dairy products such as milk, milk powder and cheese worth Shs810.56 billion to Kenya during the period.

This was a rise from Shs281.83 billion worth of milk that Uganda exported to Kenya in the period to June 2022.  Uganda’s total export value of milk and milk products increased from USD102.6 million in 2021/22 to USD 264.5m in 2022/23.

This translates to 83 percent of the total dairy products sold by Uganda during the period.

Uganda also exported milk products to other countries such as the US (Shs57.6b, Egypt (about Shs34b), South Sudan (about 26b), Tanzania (about Shs13b), Oman (about Shs6.9b), India (Shs5.2b), DRC (Shs4.5b), Rwanda (about Shs4b),  South Africa, Malawi, Somalia and Burundi.

Milk powder was the most exported product during the FY 2022/23 accounting for approximately 54.2% of the total exports followed by UHT (33.1), according to DDA.

During the period under review, Uganda’s overall dairy exports jumped 158 percent to hit $264.5 million after the country’s production of milk grew by 37 percent to 3.85 billion litres during the period, up from 2.81 billion litres in the previous year.

“Dairy exports have been increasing over time except for the financial year 2020/21 which showed a drop due to the Covid-19 pandemic, however, in the last financial year 2022/23 there was a sharp increase in the value of exports by about 158 percent,” DDA is quoted as saying.

Samson Akankiza Mpiira, the DDA acting Executive Director, says in the report that this was a big achievement despite the turbulences witnessed in Uganda export market.

Since 2022, authorities in Kenya have been limiting the number of export permits for powdered milk from Uganda and other countries and issuing others at a slow pace. In March 2023, Kenya’s Deputy President Rigathi Gachagua told a gathering the government was stopping powdered milk importation to protect local producers.

This drew protests from Uganda, with the Uganda’s leader Yoweri Museveni meeting his Kenyan counterpart William Ruto. But the increased exports sound as good news to the ears of Ugandan farmers who are still complaining of low market for their milk despite increased production costs.

According to DDA’s Akankiza, the government’s strategy of exploring more markets for Ugandan dairy products, notably Algeria and Senegal, increased confidence in the sector and uplifted spirits of sector players “given the upheavals caused by the intermittent restrictions on importation of milk into the Kenyan market.”

“The Algerian market quota which is worth USD 500m will substantially impact our sector positively and provides a long term solution to our increased production outcomes. Equally important, we have a new large scale player in the sector notably the Benni Foods dairy plant currently undergoing construction in Lyantonde District. It is expected that once complete, it will be able to absorb and process at least 1 million litres of milk per day into long shelf life products and create hundreds of jobs,” he said in the report.

However, Uganda’s national average milk consumption per capita is 63 liters (milk consumption report, FAO) against the recommended 200 liters as per World Health Organization (WHO) standards. Most of the milk produced is consumed in raw form especially in rural areas and the greater percentage is consumed in urban areas in form of powder, UHT liquid milk, Yoghurt, and other products.