Executive Summary

Sep 2019
Prospects
Cheese sales continue to be driven by the country’s growing middle class

Cheese remained something of a niche product in Kenya in 2019, largely due to being perceived as expensive by many local consumers. Hence, it mainly appeals to middle- and upper-income households.

Unpackaged hard cheese to drive growth over the forecast period

Unprocessed cheese continued to dominate the category in 2019, accounting for more than an 80% share of overall cheese value sales. Within unprocessed cheese, unpackaged hard cheese was the best performer, with this set to continue over the forecast period.

Manufacturers increasingly focusing on social media platforms to build a relationship with consumers

Brand manufacturers are increasingly recognising the importance of engaging with consumers on social media platforms. They are seeking to differentiate themselves through the use of creative and innovative themes which appeal to their target audience.

Competitive Landscape
Brown’s Cheese remains the leading player thanks to its focus on natural cheeses made using traditional methods and ingredients

Founded in 1979 in Limuru, Brown’s Cheese continued to lead the category in 2019, accounting for a quarter of overall value sales. The company, whose share remained stable over the review period, benefits from offering a wide range of cheeses made using traditional methods and ingredients.

Local manufacturers seek to widen their consumer base through offering a wider range of formats and pack sizes

Currently, cheese mainly appeals to middle- and upper-income householders in Kenya. However, manufacturers are trying to attract consumers in all income brackets by offering their cheeses in a range of different sizes and formats.

Modern grocery retailers continue to dominate sales as cheese generally remains an aspirational product

Modern grocery retailers remained the dominant distribution channel for cheese in Kenya in 2019, accounting for all of the category’s value sales. Within the channel, supermarkets continued to account for the vast majority of sales.

Prospects
Use of traditional milk stations and a prolonged drought leading to higher unit prices serve to hamper the category’s stronger growth

Although drinking milk products continued to record solid growth in both retail volume and current value terms in 2019, two factors served to hamper the category’s even stronger growth. The first was the fact that unpackaged milk in Kenya is widely available in residential areas and is preferred by many consumers due to its more affordable price.

Shelf stable milk continues to record stronger current value growth than fresh milk due to its cheaper price and the rising cost of living

Consumers in Kenya are increasingly switching to shelf stable milk from fresh milk due to the higher price of the latter and the rising cost of living. In order to compete with shelf stable milk, manufacturers of fresh milk, such as Brookside Dairy for its Tuzo brand, have been running promotions such as “buy-five-get-one-free”.

Manufacturers focus on attractive packaging and in-store promotions to drive sales

Drinking milk manufacturers in Kenya have adopted various strategies to drive sales. One of these has been a greater focus on packaging.

Competitive Landscape
State-owned New Kenya Co-operative Creameries maintains its leading position but government halts privatisation plans

Drinking milk products in Kenya continued be led by the state-owned company New Kenya Co-operative Creameries in 2019, which maintained a clear lead over second-ranked RH Devani. The company’s position can be largely attributed to a wide range of products under its KCC milk brand as well as Safari Land powder milk.

Local manufacturers lead the way thanks to their affordable prices

Domestic companies continued to lead drinking milk products in 2019, largely thanks to their ongoing investment in improving their already large production facilities, as well as their strong distribution networks and wide range of products. Furthermore, local companies are able to supply drinking milk products at very affordable prices, while also maintaining international quality standards.

Githunguri Dairy continues to gain value share in milk thanks to its focus on quality

Third-ranked Githunguri Dairy continued to gain share in milk in 2019 at the expense of the leading player Brookside Dairy and second-ranked New Kenya Co-operative Creameries. This can be attributed to the ongoing popularity of the company’s Fresha Milk brand, which nearly doubled its retail value share in the milk category over the course of the review period, with the brand being particularly strong in the capital city Nairobi.

Prospects
Yoghurt benefits from a wider assortment of products and rising health awareness

Yoghurt and sour milk products continued to record both steady retail volume and current value growth in 2019. The category is benefiting from a number of factors, particularly a widening product selection.

Promotional activities dominated by billboard and television advertisements

In Kenya, brand manufacturers tend to advertise their products from 16.00hrs, when children come home from school and turn on the television to watch entertainment programmes, but also from 19.

Sour milk products profiting from a focus on flavour development

Sour milk, or fermented milk, is common in most communities in Kenya as a staple food, particularly in rural areas. In addition, sour milk, which is also known as mala, is offered during various cultural events, such as weddings, dowry payments and traditional rites of passage, especially among the Kalenjin and Maasai communities.

Competitive Landscape
Brookside Dairy continues to lead yoghurt and sour milk products thanks to its strength in both categories

Brookside Dairy remained the clear leader in yoghurt and sour milk products in 2019, ranking first in the former and second in the latter. The company’s position can be attributed to its offer of a range of brands, for example Lala, Tuzo Maziwa Lala and Ilara in sour milk products and Ilara, Brookside and Tuzo in yoghurt.

Yoghurt and sour milk products continues to be shaped by local players

Local manufacturers continued to dominate yoghurt and sour milk products in Kenya in 2019. This is because they are able to supply fresh products at very affordable prices thanks to their huge production plants across the country.

Githunguri Dairy focuses on event marketing and rejects the idea of selling its Fresha Yoghurt brand to local rival Brookside Dairy

Githunguri Dairy, which offers the Fresha Yoghurt brand, continued to try and boost its sales in 2019 through maintaining a strong presence at events such as the Nairobi Agricultural Show. The milk processor, which is made up of about 20,000 small-scale farmers from the Kiambu County area, views such events as an opportunity to educate families about its activities and build awareness of its brands and products.

Prospects
Cream the only other dairy category with any measurable sales

Other dairy sales remained very low in Kenya in 2019 due to a lack of any tradition for such products. Cream was the only category with any measurable presence.

Other dairy largely seen as an aspirational category

Other dairy, including cream, generally remained aspirational products in Kenya in 2019, with most having a negligible presence. This can be largely attributed to their high unit prices, among other factors.

Manufacturers try and boost sales through price promotions

Local manufacturers which produce these products are trying to raise awareness of them through running in-store promotions, particularly multipack offers, in order to attract the interest of first-time buyers. In addition, Kenyan consumers are less likely to buy these products at full price, tending to purchase them only if they are bundled with something else they would usually buy, such as drinking milk products with a small sample pack of cream.

Competitive Landscape
Portcross remains the leading player in other dairy but is slowly losing share due to increasing competition

Other dairy in 2019 continued to be led by the family-owned company Portcross, which was founded in 1997 with the aim of offering consumers in Kenya and the East African region a wider variety of high quality goods which had previously been unavailable. As well as being a distributor, the company also actively markets and promotes its brands.

Kentaste Products once again the best performer thanks to the healthy positioning of its namesake brand

The biggest gain in share in other dairy in 2019 was recorded by relative newcomer Kentaste Products for the second consecutive year. Only having been introduced in 2017, the company’s Kentaste Coconut Cream has quickly gained share thanks to being positioned as offering health benefits such as relieving the symptoms of stomach ulcers and acid reflux.

Second-ranked Brookside Dairy benefits from its products carrying the Diamond Mark of Quality

Brookside Dairy, the leading player in milk and yoghurt, ranked second in other dairy in 2019, having slightly increased its value share over the course of the review period. The company offers both double cream and whipping cream under its namesake brand, positioning these as ideal for use at breakfast time on pancakes and waffles but particularly as suitable for frosting on baked goods.

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Dairy in Kenya

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Overview

Discover the latest market trends and uncover sources of future market growth for the Dairy industry in Kenya with research from Euromonitor's team of in-country analysts.

Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.

If you're in the Dairy industry in Kenya, our research will save you time and money while empowering you to make informed, profitable decisions.

The Dairy in Kenya market research report includes:

  • Analysis of key supply-side and demand trends
  • Detailed segmentation of international and local products
  • Historic volumes and values, company and brand market shares
  • Five year forecasts of market trends and market growth  
  • Robust and transparent market research methodology, conducted in-country

Our market research reports answer questions such as:

  • What is the market size of Dairy in Kenya?
  • What are the major brands in Kenya?
  • How has the economic downturn impacted sales performance given its staple food status?
  • Given mounting obesity concerns, are consumers moving from full-fat to reduced fat/fat-free offerings?
  • How are volatile farmgate prices for milk impacting retail prices and sales performance?

Why buy this report?

  • Gain competitive intelligence about market leaders
  • Track key industry trends, opportunities and threats
  • Inform your marketing, brand, strategy and market development, sales and supply functions

This industry report originates from Passport, our Packaged Food market research database.

Dairy in Kenya - Category analysis

Butter and Spreads

HEADLINES

PROSPECTS

Product choice impacted by rising health awareness
Manufacturers seek to boost sales by offering a wide range of products and pack sizes
Increasing focus on social media to build brand equity and consumer loyalty

COMPETITIVE LANDSCAPE

Five companies battle it out for the leading position in butter and spreads
Unilever continues to lead margarine and spreads thanks to the strength of its Blue Band brand
New Kenya Co-operative Creameries invests in modernising its factories

CATEGORY DATA

Table 1 Sales of Butter and Spreads by Category: Volume 2014-2019
Table 2 Sales of Butter and Spreads by Category: Value 2014-2019
Table 3 Sales of Butter and Spreads by Category: % Volume Growth 2014-2019
Table 4 Sales of Butter and Spreads by Category: % Value Growth 2014-2019
Table 5 NBO Company Shares of Butter and Spreads: % Value 2015-2019
Table 6 LBN Brand Shares of Butter and Spreads: % Value 2016-2019
Table 7 Distribution of Butter and Spreads by Format: % Value 2014-2019
Table 8 Forecast Sales of Butter and Spreads by Category: Volume 2019-2024
Table 9 Forecast Sales of Butter and Spreads by Category: Value 2019-2024
Table 10 Forecast Sales of Butter and Spreads by Category: % Volume Growth 2019-2024
Table 11 Forecast Sales of Butter and Spreads by Category: % Value Growth 2019-2024

Cheese

HEADLINES

PROSPECTS

Cheese sales continue to be driven by the country’s growing middle class
Unpackaged hard cheese to drive growth over the forecast period
Manufacturers increasingly focusing on social media platforms to build a relationship with consumers

COMPETITIVE LANDSCAPE

Brown’s Cheese remains the leading player thanks to its focus on natural cheeses made using traditional methods and ingredients
Local manufacturers seek to widen their consumer base through offering a wider range of formats and pack sizes
Modern grocery retailers continue to dominate sales as cheese generally remains an aspirational product

CATEGORY DATA

Table 12 Sales of Cheese by Category: Volume 2014-2019
Table 13 Sales of Cheese by Category: Value 2014-2019
Table 14 Sales of Cheese by Category: % Volume Growth 2014-2019
Table 15 Sales of Cheese by Category: % Value Growth 2014-2019
Table 16 Sales of Spreadable Processed Cheese by Type: % Value 2014-2019
Table 17 NBO Company Shares of Cheese: % Value 2015-2019
Table 18 LBN Brand Shares of Cheese: % Value 2016-2019
Table 19 Distribution of Cheese by Format: % Value 2014-2019
Table 20 Forecast Sales of Cheese by Category: Volume 2019-2024
Table 21 Forecast Sales of Cheese by Category: Value 2019-2024
Table 22 Forecast Sales of Cheese by Category: % Volume Growth 2019-2024
Table 23 Forecast Sales of Cheese by Category: % Value Growth 2019-2024

Drinking Milk Products

HEADLINES

PROSPECTS

Use of traditional milk stations and a prolonged drought leading to higher unit prices serve to hamper the category’s stronger growth
Shelf stable milk continues to record stronger current value growth than fresh milk due to its cheaper price and the rising cost of living
Manufacturers focus on attractive packaging and in-store promotions to drive sales

COMPETITIVE LANDSCAPE

State-owned New Kenya Co-operative Creameries maintains its leading position but government halts privatisation plans
Local manufacturers lead the way thanks to their affordable prices
Githunguri Dairy continues to gain value share in milk thanks to its focus on quality

CATEGORY DATA

Table 24 Sales of Drinking Milk Products by Category: Volume 2014-2019
Table 25 Sales of Drinking Milk Products by Category: Value 2014-2019
Table 26 Sales of Drinking Milk Products by Category: % Volume Growth 2014-2019
Table 27 Sales of Drinking Milk Products by Category: % Value Growth 2014-2019
Table 28 NBO Company Shares of Drinking Milk Products: % Value 2015-2019
Table 29 LBN Brand Shares of Drinking Milk Products: % Value 2016-2019
Table 30 Distribution of Drinking Milk Products by Format: % Value 2014-2019
Table 31 Forecast Sales of Drinking Milk Products Products by Category: Volume 2019-2024
Table 32 Forecast Sales of Drinking Milk Products Products by Category: Value 2019-2024
Table 33 Forecast Sales of Drinking Milk Products Products by Category: % Volume Growth 2019-2024
Table 34 Forecast Sales of Drinking Milk Products Products by Category: % Value Growth 2019-2024

Other Dairy

HEADLINES

PROSPECTS

Cream the only other dairy category with any measurable sales
Other dairy largely seen as an aspirational category
Manufacturers try and boost sales through price promotions

COMPETITIVE LANDSCAPE

Portcross remains the leading player in other dairy but is slowly losing share due to increasing competition
Kentaste Products once again the best performer thanks to the healthy positioning of its namesake brand
Second-ranked Brookside Dairy benefits from its products carrying the Diamond Mark of Quality

CATEGORY DATA

Table 35 Sales of Other Dairy by Category: Volume 2014-2019
Table 36 Sales of Other Dairy by Category: Value 2014-2019
Table 37 Sales of Other Dairy by Category: % Volume Growth 2014-2019
Table 38 Sales of Other Dairy by Category: % Value Growth 2014-2019
Table 39 NBO Company Shares of Other Dairy: % Value 2015-2019
Table 40 LBN Brand Shares of Other Dairy: % Value 2016-2019
Table 41 Distribution of Other Dairy by Format: % Value 2014-2019
Table 42 Forecast Sales of Other Dairy by Category: Volume 2019-2024
Table 43 Forecast Sales of Other Dairy by Category: Value 2019-2024
Table 44 Forecast Sales of Other Dairy by Category: % Volume Growth 2019-2024
Table 45 Forecast Sales of Other Dairy by Category: % Value Growth 2019-2024

Yoghurt and Sour Milk Products

HEADLINES

PROSPECTS

Yoghurt benefits from a wider assortment of products and rising health awareness
Promotional activities dominated by billboard and television advertisements
Sour milk products profiting from a focus on flavour development

COMPETITIVE LANDSCAPE

Brookside Dairy continues to lead yoghurt and sour milk products thanks to its strength in both categories
Yoghurt and sour milk products continues to be shaped by local players
Githunguri Dairy focuses on event marketing and rejects the idea of selling its Fresha Yoghurt brand to local rival Brookside Dairy

CATEGORY DATA

Table 46 Sales of Yoghurt and Sour Milk Products by Category: Volume 2014-2019
Table 47 Sales of Yoghurt and Sour Milk Products by Category: Value 2014-2019
Table 48 Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2014-2019
Table 49 Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2014-2019
Table 50 NBO Company Shares of Yoghurt and Sour Milk Products: % Value 2015-2019
Table 51 LBN Brand Shares of Yoghurt and Sour Milk Products: % Value 2016-2019
Table 52 Distribution of Yoghurt and Sour Milk Products by Format: % Value 2014-2019
Table 53 Forecast Sales of Yoghurt and Sour Milk Products by Category: Volume 2019-2024
Table 54 Forecast Sales of Yoghurt and Sour Milk Products by Category: Value 2019-2024
Table 55 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2019-2024
Table 56 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2019-2024

Packaged Food in Kenya - Industry Overview

EXECUTIVE SUMMARY

Healthy growth recorded in 2019 despite tough trading conditions
Growing middle class helps sustain growth as threats of food shortages persist
Packaged food remained competitive with a mix of local and international players
Value for money drives growth of modern retailing in 2019
Expansion of middle class set to boost demand for packaged food

FOODSERVICE

Sales to foodservice
Increase in foodservice outlets spur demand for packaged food
Young urban population and expanding middle class drives growth of foodservice channels
Hot supermarket meals offer greater convenience

CATEGORY DATA

Table 57 Foodservice Sales of Packaged Food by Category: Volume 2014-2019
Table 58 Foodservice Sales of Packaged Food by Category: % Volume Growth 2014-2019
Table 59 Forecast Foodservice Sales of Packaged Food by Category: Volume 2019-2024
Table 60 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2019-2024

MARKET DATA

Table 61 Sales of Packaged Food by Category: Volume 2014-2019
Table 62 Sales of Packaged Food by Category: Value 2014-2019
Table 63 Sales of Packaged Food by Category: % Volume Growth 2014-2019
Table 64 Sales of Packaged Food by Category: % Value Growth 2014-2019
Table 65 GBO Company Shares of Packaged Food: % Value 2015-2019
Table 66 NBO Company Shares of Packaged Food: % Value 2015-2019
Table 67 LBN Brand Shares of Packaged Food: % Value 2016-2019
Table 68 Distribution of Packaged Food by Format: % Value 2014-2019
Table 69 Distribution of Packaged Food by Format and Category: % Value 2019
Table 70 Forecast Sales of Packaged Food by Category: Volume 2019-2024
Table 71 Forecast Sales of Packaged Food by Category: Value 2019-2024
Table 72 Forecast Sales of Packaged Food by Category: % Volume Growth 2019-2024
Table 73 Forecast Sales of Packaged Food by Category: % Value Growth 2019-2024

SOURCES

Summary 1 Research Sources