Construction of Kenya's first fertiliser factory started on Friday in Eldoret, with an estimated completion cost of Sh12 billion.

Deputy President William Ruto said the Sh12 billion factory, to be completed in June next year, will help cut the cost of fertiliser by more than 50 per cent.

The government hopes this will reduce the overall cost of farm inputs.

The factory is being put up by the government and Toyota Tshusho East Africa, a Japanese firm.

"This factory is very important because it will produce specific fertiliser for various crops, including maize, wheat and sugarcane," Ruto said.

He said Kenya relies heavily on agriculture and imports costly fertiliser, which is unsuitable for the country's soil.

"The government's aim is to cut the cost of production through reducing the cost of fertiliser. This factory will produce fertiliser with the correct formulation for the correct crop," Ruto said.

He said Kenya faces a shortage of sugar because of the high cost of production.

Ruto was speaking at Chesegem in Eldoret South where the factory will be constructed.

Governors Jackson Mandago of Uasin Gishu, Alex Tolgos (Elgeyo Marakwet), Patrick Khaemba (Trans Nzoia) and Kennedy Lusaka of Bungoma were present. Japanese ambassador Tatsushi Terada was also present.

Ruto said the factory will be expanded.

He said he has discussed increasing milk production with the region's governors because of high demand.

Ruto said the government has released Sh400 million to expand the New KCC factory in Eldoret, which receives only 25 per cent of the milk it should process.

The DP said Kenya will make history next year by hosting the Japanese Prime Minister and 50 African heads of state to discuss the partnership between the continent and Japan.

"This will be a great opportunity for Kenya to market itself internationally," he said.