Building Strong Stakeholder Support for Collaborative Actions: The Case of the East Africa Dairy Development (EADD) Project
A presentation at the 4th Multi-Stakeholder Platform meeting, 15-17 Oct.2013 Ottawa, Canada. By Saeed A. Bancie
• 115 million people in East Africa - over half subsisting on less than $1 per day in an agricultural economy of small-scale, resource-poor farm communities.
• There are over 10 Million smallholder dairy farmers in East Africa using largely subsistence methods of animal husbandry.
• Families are caught in a downward poverty spiral, characterized by declining food intake, poor education and health services, degraded and disappearing grasslands for their herds, and little-to-no access to commercial market systems.
• Women are responsible for up to 80% of food produced in Africa. They frequently have the fewest resources and are particularly affected by economic poverty.
The Context of dairy in East Africa
Context (cont’d)
Traditional Dairy Market Model
4
Why Dairy/Why East Africa?
• Heifer International had implemented small-scale dairy projects in EA for several years, with great success.
• The small-scale projects reached only a limited number of small-holders.
• Heifer decided to scale-up its dairy value chains model, in keeping with the organization’s development strategy to implement “bigger and faster” projects, to achieve greater impact on a critical mass.
• Recognizing that this could not be achieved by a single organization, Heifer decided to foment public-private sector-NGO partnerships to support the establishment of dairy value chains in rural communities.
• EA is an agricultural economy of small-scale, resource-poor farm communities with 115 million people, half of them subsisting on less than $1 per day.
Uganda
Rwanda
Bovine Milk Production per person: Africa
This map was produced by combining the high resolution cattle population map produced for Africa with estimates of milk production produced by the Livestock Development Planning System Version 2 (LDPS2). The resulting milk production data was then combined with the human population map to give the amount of milk produced per person.
http://ergodd.zoo.ox.ac.uk/livatl2/bvmilkprodcapita.htm
Region produces est. 8 billion litres of milk p.a
Where?
5
Our geographic scope
EADD’S Impact goal
The lives of 179,000 families—or approximately one million people—are transformed by doubling household dairy income by year 10 through integrated interventions in dairy production, market-access and knowledge application.
Who we work with 110,000 farmers in
Kenya
45,000 farmers in Uganda
24,000 farmers in Rwanda
At least 30% women
Target
At Dec 2012
110,000
45,000
24,000
120,000
45,000
24,306
Approaches: Market access Model
Value-Chain/ Hub Model
Regional Enabling Environment (Quality standards & trade policy)
Local / National Enabling Environment
Support markets
• BDS services (Transport, AI, extension, etc)
• Financial
Producers Organizations (DMGs/DIGs/FCs)
Input Suppliers
Processors
Consumers (High end)
DFBA (CP hubs)
The dairy value chain
Informal traders
Milk kiosk/ canteens
Retail Outlets
Consumers (Low end)
Export market
Formal/High end marketInformal/
Low end market
The Solution – Transforming Chilling Plants to Business Hubs
TRANSPORTERS
FEED SUPPLY
AI & EXTENSION
TESTING
Farmers
FIELD DAYS
VILLAGE BANKS
OTHER RELATED MEs
HARDWARE SUPPLIERS
CHILLING HUB
TRANSPORTERS
FEED SUPPLY
AI & EXTENSION
HARDWARE SUPPLIERS
CHILLING HUB
FARMERS
VILLAGE BANK
SERVICES & INPUTS
How Farmers pay for Services
through the Business Hub
Emerging Rural Economies (Kenya)
Rural Village Banks jointly owned by farmer
shareholders, being established 14
New Prosperity in Rural Africa!
Tanykina Dairy• Milk Chilling & agrovet, AI & FSA• 35,000 litres/day• 5,850 farmers• profitable
Siongiroi Dairy Plant• Milk Chilling• 28,000 litres/day• 5,034 farmers• profitable
Kabiyet Dairy Plant • Chilling & AI & Agrovet• 32,000 litres/day• 3,300 farmers• profitable
Olkalou Dairy Ltd.• Milk Chilling• 21,000 litres/day• 3,296 farmers• profitable $15.0m p.a.
Over 180,000 Liters Daily
Over 83,000 farmers
15
• Acceptance of dairy as viable business enterprise
• Increased milk production per household and per cow
• Greater access to secure dairy markets
• Financial benefits to complementary service providers (transporters, fodder providers, AI, agrovet)
Major Accomplishments
Major Accomplishments
EADD Quality Interventions
• EADD has partnered with various stakeholders to address raw milk quality in the region including– New KCC and Nestle EAR in Kenya– Sameer and Inyange in Uganda and Rwanda– Statutory bodies such as Kenya Dairy Board
and Uganda’s Dairy Development Authority. • To-date 190 Chilling Plant staff have been
trained in milk hygiene and testing. • Tetra Pak EA financed a quality best-
practice protocol at Metkei CP (Kenya).• Nestle EAR carried out audits at New KCC
and Sameer in Uganda.
EADD Quality Interventions
• A system of payment for milk quality has been variously proposed but yet to gain any traction with processors.
• Quality-based pricing standards and incentives locked into contracts between CPs & processors will speed farmer up-take of feed, breed and hygiene processes and increase self-regulation of milk quality by farmers.
• Notably, bacteria count in Rwanda have reduced from 48 million in 2009 to a maximum of 14 million in 2010.
• Milk rejection at CPs in Kenya has reduced by 50%; Uganda by 50% and Rwanda by 16% since the project started in 2008
Transitioning from local to exotic breeds…
Achievement at farm level
• Businesses contracted have substantially increased their incomes– Agro-vets, feed suppliers, AIs, food
stores – Check-off system helps to drive these
businesses– A few established feed, drug shops
negatively affected by competition• Farmers employ more workers, nearly all
male– USH 50,000 – 80,000 per month in
Uganda
Economic benefits and spillover
• Establishment of alternative milk market for dairy farmers
• Improved small farmers’ position in the dairy value chain
• Improved business management capacity of hubs since MTE
• Financial viability of some hubs
• Establishment of financial services and check-off credit
Achievement at dfba level
Projected stage distribution in December 2013
Stage 1 Stage 2 Stage 3 Stage 4 Stage 5
10
34
27
10
8
28
31
7
0
4
14
39
16
0
5
13
2322
10
2010 2011 2012 2013*
At current growth rates, 10 hubs will be in stage 5 and 22 hubs in stage 4 by December 2013
• Managing seasonal fluctuations (affects productivity and price)
• Inadequate access to extension services
• Economic constraints to adoption of improved practices
• Lack of gender parity in decision making and access to credit
• Limited capacity to mitigate climate change
• Limited financial incentive (at farm level) for shareholding
Challenges-profitability of dairy farming
Challenges• Governance (transparency, trust, representation,
communication, clarity of roles and responsibilities)
• “Extension is key” – yet extension services are not consistently prioritized
• Limited profit margin of milk bulking, limited negotiating power with private processors
• Limited business management capacity– need for further professionalization among boards and staff
• Few women in leadership roles
• Limited capacity of hub FSAs to provide dairy investment loans
Challenges-performance at DFBA level
Asanteni Sana!