White Gold: Opportunities for Dairy Sector Development Collaboration in Ethiopia & East Africa

Transcription

1 White Gold: Opportunities for Dairy Sector Development Collaboration in Ethiopia & East Africa Inter Agency Donor Group Meeting Seattle September 16, 2014 Nathaniel Makoni, ABSTCM Ltd Raphael Mwai, PPD Consultants Tsehay Redda, EDBD Services Akke van der Zijpp, Wageningen University Jan van der Lee, Centre for Development Innovation, Wageningen UR

2 Study Countries

3 Outline 1. Terms of Reference 2. Dairy Status 3. Key Issues Regional level Country Level 4. Follow up Donor Collaboration Agenda 5. Conclusion

4 Terms of Reference Country assessments Value chains Enabling environment (Policy dairy sector, organizations, training) Donor programs General analysis Expert Consultation for 1) validation and 2) agenda setting Recommendations for action

5 Dairy Status Dairy Value Chains Scenarios - East African Countries Inputs & services Aggregator MCC Transport Processor Retail /Transport To Market To market raw warm milk Consumer Cottage industry

6 East Africa Dairy Development Trajectory 97% 95% 90% 80% Tanzania Burundi Ethiopia Kenya Formal:Informal Sector Informal 87% Formal 13% 80% Rwanda 80% Uganda

7 Regional Economics Data 943 GDP /Capita WB 2012/13 8 Dairy Contribution to GDP (%)? ,53 Kenya Rwanda Tanzania Uganda Ethiopia Burundi Kenya Rwanda Ethiopia Uganda Burundi Tanzania Significant investments in dairy production

8 National Cattle, & Dairy Cattle Data National Cattle Population (Million) 49,2 3,5 Improved Dairy Breed Population (Million) ,8 1,5 0,7 0,68 0,65 0,2 0,19 0,01 Kenya Tanzania Uganda Rwanda Ethiopia Burundi 19 Improved Dairy Cattle as % of National Cattle Population 13 Kenya & Rwanda lead in dairy genetics infusion 5 3 1,4 1 Kenya Rwanda Uganda Tanzania Burundi Ethiopia

9 Regional AI Status Annual AI as % of National Herd 18,0 AI use <20% Sexed <2% 12,0 5,8 4,6 0,3 0,2 National bull studs in all Countries Kenya Rwanda Tanzania Uganda Ethiopia Burundi AI Cost/Service (US$) & Farmgate milk equivalent/service (liters) Improve artificial insemination cost & efficiency of delivery

10 National Milk Production / Year (Million Liters) Total Regional Production = Billion Potential Demand = 48.5 Billion Estimated Gap = 37.4 Billion Kenya Ethiopia Tanzania Uganda Rwanda Burundi

11 Regional Farm Gate Prices/Liter (US$) 0,41 0,39 0,36 0,22 0,18 0,14 Ethiopia Kenya Burundi Rwanda Tanzania Uganda Uganda has least cost/ ltr. for farm-gate and processed milk Ethiopia risks to be uncompetitive The farm gate prices reflect feed costs

12 Milk Processing Capacity 2,9 Installed vs Utilized Capacity (Million Liters) 1,2 1,0 0,6 0,4 0,2 0,2 0,2 0,1 0,1 0,0 0,2 Kenya has the dominant regional dairy processor Some claimed installed capacity is uninstalled Under-utilized capacity across the region averages 49% What is the effect of low capacity utilization on milk price & consumption?

13 1,19 Regional Milk Processing and Packaging Processed Milk Price/Liter 0,98 0,87 0,65 0,59 0,38 Rwanda Burundi Ethiopia Tanzania Kenya Uganda Rwanda & Burundi have high cost of pasteurized milk due to (OH & packaging 50%) Uganda has lowest price of pasteurized milk

14 Dairy Product Range (8) Brookside, NKCC, Pearl & SALL

15 Population, Urbanization, Income Growth and Milk Consumption/Capita 92 National, Urban Population (Million) & % Urban Growth Rate Population Urban Urban Gr. Rate Kenya Tanzania Gross National Income Per Capita - East Africa (USD) Rwanda Uganda Ethiopia Burundi Ethiopia Tanzania Kenya Uganda Rwanda Burundi 99 Milk Consumption/Capita (liters) Region s consumption < FAO rec. 200l/Capita 2. Potential demand remains high

16 Low female & youth involvement Inadequate financial services Poor infrastructure & access to markets Limited official industry data Low cow productivity: feed&breed National & Tranboundary diseases Seasonal milk supply Low farmer education & organization Limited research & extension Lack of conducive policy & incentives Poor milk quality

17 Emerging Issues?

18 Integration to International Players JV 60:40 AFRODANE DAIRY LTD Integration with International players has implications on farmer loyalty, commercialization and milk quality

19 Major market player - Donor engagement is essential Can mergers and consolidation improve loyalty, milk quality & services?

20 JESA Integrated Dairy Model JESA Commercial Farm Milk supply 50% US$0.4/ litre Smallholder Farms -Milk supply 50% Price premium $0.4 vs $0.3 AI, Extension, Finance & Veterinary services

21 Blessed Dairy Consolidation & Quality improvement Model RwF 180 RwF 250 RwF 400 RDCP-II Assistance US$28,875 RwF 320 RwF 300 Now 2 trucks

22 Follow-up donor collaboration agenda as defined at & after Expert Consultation Masaka-Mbarara, Uganda, April 2014

23 Thematic priorities 1. More milk from roughage 2. Breeding for more and better animals 3. Healthy animals 4. Strengthening of farmer organizations and access to finance 5. Safeguarding and rewarding good milk quality 6. Better policy through better availability of data on farm/firm-, chain-, and sector level 7. Competency of dairy farmers, staff, and entrepreneurs along the value chain 8. Sustainable intensification related issues biogas and closing the nutrient cycle

24 1. More milk from roughage Lead: SNV Netherlands Development Organization Contact persons: Jurjen Draaijer Bram Wouters Others (?): ICRAF, ILRI, Wageningen UR, FAO Progress: Feasibility studies commercial fodder production Kenya, Uganda (SNV, Wageningen UR, The Friesian)

25 2. Breeding for more and better animals Lead: Contact person: Others (?): Progress: Bill & Melinda Gates Foundatioin Donald Nkrumah, FAO, KARI/NARO/EIAR, Egerton, ILRI, Wageningen UR» Lessons from South African genetic impact assessment protocol to evaluate breed introductions» BMGF investment in dairy genetics to increase heifer supply (more this meeting)

26 3. Healthy Animals Lead: BMGF Contact person: Windy Wilkins Others (?): Progress: OIE, AU-IBAR, GALVMed, VSF, ITM, Sidai, Wageningen UR, FAO. contagious diseases and zoonoses collaboration?

27 4. Strengthening of farmer organizations and access to finance Lead: Agriterra Contact persons: Cees van Rij Others (?): Progress: Plans: IFAD, SNV, Wageningen UR, BMGF, EADD Agriterra plans on dairy cooperative development:» EA program for dairy cooperative dev., clustered approach» International platform on peer2peer advisory, training, exchange» Study tour programs to the Netherlands and Kenya» Coordination, co-creation and joint action with international partners to further leverage outreach and impact» Expand international dairy cooperatives network (USA, Canada)

28 5. Safeguarding and rewarding good milk quality Lead: Kenyan Dairy Board and SNV Contact person: Jurjen Draaijer, SNV Others (?): EADD, ILRI, FAO, Wageningen UR Progress: Feasibility studies: - SNV in Kenya, Rwanda Pilots Quality-Based Milk Payment Schemes: - SNV & The Friesian in Kenya - USAID-LMD in Ethiopia Plans: KDB on advancing regulatory issues within EAC

29 6. Better policy through better availability of data on farm/firm-, chain-, and sector level Lead: ILRI Contact persons: Edgar Twine Isabelle Baltenweck Others (?): Progress: FAO, BMGF (LSMS data), SNV (profitability), National statistics agencies, Wageningen UR (LEI) ongoing work:» Strengthening of systems for data collection, analysis, and evidenced-based policy making (BMGF w/ WB (LSMS)» Livestock Data Innovation in Africa project (Tanzania,Uganda)» Willingness to share program data on farm data and bulking

30 7. Competency of dairy farmers, staff, and entrepreneurs along the value chain Lead: Wageningen UR, SNV Contact persons: Adriaan Vernooij Jurjen Draaijer Others (?): Progress: FAO, GIZ, IFAD o quick scan of initiatives in dairy and other sectors (due Nov) o discussion paper on improvement options (due December) o many ongoing and planned activities o more coherence needed between private initiatives and formal agricultural education system

31 8. Sustainable intensification related issues biogas and closing the nutrient cycle Lead: SNV Contact person: Felix ter Heegde Others (?) : IFAD, Wageningen UR, FAO Progress: Bio-slurry projects in Kenya (SNV/HIVOS/Ecom SMS/Wageningen UR) Theme under Global Agenda for Sustainable Livestock

32 Points to ponder Joint agenda 1. What could be improved, what s missing? 2. Can we turn this into a joint IADG agenda with broad buy-in? Possible activities: Exchange of experiences, e.g. through news service Link with other global or regional networks?...

33 Thank You