Kenya Meat Commission pays off debts worth US$2.2m months after ministerial transfer

KENYA – State-owned meat processor Kenya Meat Commission has started to make a turn round in its operation since its transfer from the Ministry of Agriculture, Livestock and Fisheries to the Ministry of Defence.

According to Interior Cabinet Secretary Fred Matiang’i, KMC has met the bulk of its debts owed to livestock farmers and other suppliers since the military takeover, with so far clearing Ksh250 million (US$2.2m) worth of debts.

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A further Ksh150 million (US$1.37m) has been allocated to offset the balance of other general suppliers in this financial year.

The loss-making parastatal has also registered a nearly 30 per cent increase in the number of livestock supplied to it, as farmers and others suppliers have been motivated by faster payments for deliveries, reports The Standard.

“Through the government transfer of KMC to the Ministry of Defence, we have managed to clear Sh250 million (US$2.2m) debt owed to livestock farmers. A further Sh150 million (US$1.37m) has been allocated to clear debts to other general suppliers this financial year. The other managerial issues in running the KMC facilities are now being effectively addressed,” CS Matiang’i said.

The renewed confidence by farmers is expected to lift the fortunes of KMC. The entity in the year to June 2020 posted a loss of Sh100 million (US$913k) from a revenue of Sh174 million (US$1.59m), according to a National Treasury report. Its net assets stood at Sh1.54 billion (US$14.07m) in June.

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The CS, who chairs the Cabinet Committee on development, termed KMC’s transfer to KDF as a logical and necessary move.

“The other managerial issues in running the KMC facilities are now being effectively addressed.”

Interior Cabinet Secretary – Fred Matiang’i

The bid, he said, was informed by the mutual interests of the two organisations and those of livestock farmers and the country.

As its largest client, the military had a stake in seeing that the KMC was efficiently managed while the meat processor stood to benefit from a guaranteed market, Matiang’i said.

He was speaking during a virtual public lecture on the opportunities and challenges facing the livestock sector that was organised by the President’s Delivery Unit and Strathmore University.

Prior to the management transfer, the government-owned entity was operating below capacity and grappling with an unreliable supply of raw materials and an ageing plant, which slowed down its operations.

The Athi River-based plant slaughtered 200 cattle per week, despite it having the capacity to process the same number of animals per day.

The poor performance by the firm had been escalating since the 1960s because of political interference, obsolete machinery, and loss of the European Union market due to animal diseases.

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