implementation of a quality-based milk payment (qbmp ... · implementation of a quality-based milk...

Implementation of a quality-based milk payment

(QBMP) system in Kenya

Presented by:

Teresiah Ndungu

HC Project Manager

Milk Quality

11/26/2017 1

What I would like to share with you today

1. Happy Cow Ltd, the SNV Kenya Market-led Dairy Programmeand the start of the Project with a zero-setting

2. Challenges in the raw milk smallholder supply chain

3. The intervention plan in the Quality Based Milk Payment (QBMP) project.

4. Parameters and tools applied in QBMP

5. Reducing antibiotic residues in milk: use of DSM - Delvotechnology. Relevant slides; courtesy of DSM, Food Specialty.

6. Results and outcomes

11/26/2017 Teresiah Ndungu, Happy Cow- ESADA SA 2

1. Happy Cow Ltd, the SNV Kenya Market-led Dairy Programme and the start of the Project

with a zero-setting.


1.1: Partners in the project

Happy Cow Ltd.

• Private family owned dairy processing company in Nakuru, KE

• It produces mainly cheese and yoghurt.

• The source of raw milk is from mainly two cooperatives with

dairy smallholders.

The two cooperatives

• New Ngorika Milk Producers Ltd in Nyandarua county.

• Olenguruone Dairy Cooperative Society in Nakuru county.

SNV Kenya Market-led Dairy Programme (KMDP)

• Funded by the Embassy of the Kingdom of the Netherlands and

implemented by SNV Kenya and dairy stakeholders.

• It implements various activities to improve the dairy sector like

farmers training, fodder production and preservation.


1.2: The start of the Quality Based Milk Payment (QBMP) project

• Historical data suggested major challenges in TPC, CC,

adulteration & antibiotic residues, way above KEBS standards.

• A project proposal/request for funding was submitted by Happy

Cow ltd to the SNV Kenya Market-led Dairy Program.

• Embassy of the Kingdom of the Netherlands in Nairobi supported

the project through SNV-KMDP.

• Technical advice was received from The Friesian Agro

Consulting and Dairy Training Centre.

• A Track and Trace system was a pre-condition for a QBMPs.

• The starting point was a Zero Setting baseline study, mid 2015,

followed by interventions.


1.3: The origin of the project Some historical data on raw milk supplied to Happy Cow Ltd.


DATE CBE TBC/ML CC/ML RESAZURIN

TEST

ANTIBIOTIC

KEBS 2007 < 2,000,000 < 50,000 4-6 < 4 PPB

1 7/6/05 BULK SILO 98,000,000 9,900,000 4

2 2/2/10 BULK SILO 80,000,000 2,900,000 4

3 26/9/11 BULK SILO 160,000,000 1,900,000 4

4 9/7/14 Coop A 170,000,000 6,600,000 4

5 24/10/14 Coop A 89,000,000 7,900,000 4 POSITIVE

6 1/11/14 Coop B 190,000,000 2,000,000 5 POSITIVE

7 19/11/14 Coop A 110,000,000 1,700,000 5 POSITIVE

8 26/11/14 Coop B 10,000,000 190,000 4 POSITIVE

9 7/01/15 Coop A 110,000,000 2,700,000 4

10 28/01/15 Coop A 160,000,000 3,100,000 4

11 30/04/15 Coop A 100,000,000 1,400,000 4

1.4: Zero Setting results in mid-2015: Quality of raw milk at main critical points

• High bacterial load.

• High rates of antibiotic residues.

• High incidences of mastitis.

• Adulteration cases (water and preservatives).

• Lack of correlation between resazurin test and total plate count.

• Inefficiency of the milk coolers installed (can act as incubators).


0

5

10

15

20

25

30

Can Route Before

cooling

After

cooling

MIL

LIO

NS

/ML

SAMPLING LEVELS

1.5: Zero-setting: Breakdown of cold chain

Interventions at MCC to arrest microbial multiplication could include:

• Enhance hygiene practices; from farm level to MCC.

• PHE + Ice bank or Instant Chiller (quickly cooling to 4◦c).

• Thermization (PHE heating at 65◦C/15sec and cooling to 4◦c).11/26/2017 Teresiah Ndungu, Happy Cow- ESADA SA 8

0

5

10

15

20

25

0 2 4 6 8 10

To

tal P

late

Co

un

t (m

il c

fu/m

l)

hr

Milking at 4◦c Collection

Timing from milking to Milk Cooling Centers (MCC) and collection by tanker

Transport to milk cooling center

Inside the milk cooling tank

MCC

2. Challenges in the raw milk smallholder supply chain


Challenges 2.1: Milk collection in rural setting

• Poor infrastructure (poor interior and main roads).

• Many small scale farmers in supply chain >1.5 million.

• A small scale farmer might market < 8.0 ltr/day

• High initial cost of the cooling centers.

• Lack of potable/reliable source of water.

• Lack of trained milk graders and handlers.

• Informal milk marketing (milk hawkers/traders).

• Lack of raw milk traceability.


Challenge 2.2: Disputable practices in milk collection


• Use of dirty plastic jerry cans and sometimes preservatives

• Milk collection up-to 11.30hr and inefficient milk coolers

• Coops/processors accept rejected raw milk from elsewhere.

Challenge 2.3: Milk quality health/safety concerns

• Preservatives like H2O2 masks bad hygienic practices in the value chain.

• Free radicals released by H2O2 can have health effects e.g. DNA mutation, cancer etc.

• Antibiotic residues contributes to the risk of allergic reactions and antibiotic resistant pathogens.

• Adulterants: water to increase volume and starch, sugar etc. to compensate for density can also act as contamination sources.

• High bacterial counts produce heat resistant enzymes which can be passed to the final dairy products.


Challenge 2.4 : The Kenyan dairy industry

• Quality of raw milk has been disputed for long and almost no

documented data exists.

• The regulatory institutions are constrained financially or by other

reasons: standards are reluctantly applied and enforced.

• Dairy processors and coops are not proactive to improve quality.

• Challenges for coops also include observing the cold chain rules

and unfair competition by milk hawkers.

• It seems there are unethical practices in raw milk value chain.

• This creates a vacuum for farmers to switch between buyers of

raw milk specially due to quality issues.

• Market is volume based and low consumer awareness on

quality/food safety concerns.


3. The intervention plan in the QBMPS project


3: Project interventions

1. Track and trace: milk can labeling & ownership and IT program.

2. Labs for acceptance tests (at Coops) and QBMP tests (at HC).

3. Organize farmers into groups at collection points with milk sheds.

(Efficient, fast and transparent milk collection).

4. Use of aluminum cans instead of plastic containers.

5. Use of reasonable clean water e.g. for can washing.

6. Use of plate heat exchanger (PHE) for fast cooling.

7. Training farmers & milk handlers on raw milk hygienic.

8. Separation of morning & evening at milk collection where twice

collection is impossible.


3.1: Milk Quality Tracking & Tracing System(MQ-T&T)

MQ-T&T will allow:

• Actors in the Coop to identify the raw milk quality at critical points in the collection chain.

• Identification of the cans, farmers and routes.

• Identification of causes attributing to quality losses.

• Appropriate corrective actions to improve quality.

• Therefore, a T&T must be able to connect the milk quality in a can to a certain group of suppliers for appropriate payment of their milk.


3.1: MQ-T&T, IT program and payments


A computer program was developed to link:

1) Individual farmers to a certain milk can (at coop level)

2) Randomly tested cans on quality parameters (at HC lab)

3) Payment to farmers based on quality results (feedback to coop)

3.2: Laboratories


HC laboratory- QBMP testsCooperative lab- Acceptance tests

• Milk need to pass all acceptance tests before bulked in the cooler

• Random can-samples are taken for QBMP tests at HC lab

3.3: Milk collection points (MCP)

Milk Collection Points (MCPs) are necessary for fast grading and collection of raw milk using graders and peer pressure.


3.4: Only proper milk cans, no jerry cans


A stubborn practice

difficult to change

3.5: Use of clean water e.g. for can washing.


But…rural

conditions…

3.6: Instant chilling combined with cooler


Economical option: use of same compressor(s)

3.7: Training farmers, graders & handlers


4. Parameters and tools applied in QBMP


4.1: Sampling regime in the QBMPS project

1. Milk qualifying for QBMP testing needs to pass all platform tests.

2. Accepted raw milk is bulked in a cooling tank and can samples are

taken for analysis at the HC-lab to classify payment mode.

• Cans are tested twice/month.

• The analysis results are shared at the end of a month


4.2: Parameters applied in QBMP at HC lab

1. Total plate count.

2. Presence of antibiotic residues

3. Adulteration

4. Total solids (incl. fat, protein, lactose and ash)

5. Somatic cell count (start 2018)

6. Aflatoxin M1 (start 2018)

NB:

Cans that pass these parameters receive bonus


5. Reducing antibiotic residues in milk: use of DSM - Delvo technology. Relevant slides;

courtesy of DSM, Food Specialty.


5.1: Antibiotic treatment and withdrawal period

All drugs carry information about withdrawal period

“The period necessary between the last administration of the veterinary medicinal product to animals,….. and the production of foodstuffs from such animals, in order to protect public healthby ensuring that such foodstuffs do not contain residues in quantities in excess of the maximum residue limits for active substances laid down pursuant to Regulation (EEC) No 2377/90.”

(DIRECTIVE 2001/82/EC)


5.2: Withdrawal period - even when adhered, to often not enough


Concentration

of antibiotics

in milk after

treatment

Days or number of milkings after treatment

Advised withdrawal

time based on healthy

cows.

MRL

* Healthy cow?

* Normal milk visually ?

* Back to normal quantity ?

* Label use?

Second treatment

5.3: Delvo-kit for anti-biotic residue testing


5.4: Automatic reading with Delvo® Scan to reduce subjectivity of the eye


• Instrumental reading capturing numerical values on colors of test results

• Software package using a standard PC/Windows and scanning device

• Test results printed and saved for documentation

6. Main achievements, outcomes and challenges


6.1: HC payment module consolidated

Test TPC

Grade A

TPC grade

B

TPC grade

C

Antibiotics Adulteration Total

solids

% score +50 0 -50 +15 +20 +15


GRADE

% PAYMENT

RANGES

PAYMENT AMOUNT

(KSH)

A 70-100 Premium +2

B 40-69 Standards +1

C <40 Penalty 0

NB: Its difficult to have a price neutral payment system that penalties

pay for the bonuses.

6.2: Main project achievements

1) This pilot project has put QBMP high on the agenda.

Awareness took place at all levels (15 PPT presentations over

last 2 years).

2) Many forums have agreed that Kenya cannot afford to

continue paying only volume (2016 at 5.2 billion liters) for all

kind of reasons.

3) Achievement in the 4 parameters:

• Antibiotic residues much reduced (< 4% occurrence)

• Total Solids: now often within standards

• Adulteration: now often within standards

• TPC: is main challenge and still way above standards


6.3: QBMPS: financial and health benefits for private and public good


General:

• Export/trade market expanded.

• Prolonged product shelf life.

• Improved product quality.

• Guaranteed food safety.

Processors: reduced processing costs and losses (<market returns).

Farmers:

• Improved income through bonus and reduced losses (<rejection).

• Payment based on composition (fat & protein) thus encourage

proper breeding with higher TS/ltr.

6.4: Drivers of quality enhancement in value chains

• Dairy sector: need of self-regulation, codes of conduct (GDP),

capacity to invest, adhere to general ethics, etc.

• Government/regulators: improve enforcing dairy regulations and

quality standards.

• Kenya Dairy Processors Association (KDPA): need for a

committee on “raw milk quality” and one code of best practice for

milk collection (especially to reduce TPC)??

• Consumers/retailers: awareness and demand for safe, quality and

affordable dairy products.

• Competition: (local/international) can usually improve quality and

affordability. Allow some importation - but not distorting.


6.5: Lessons learned

• Commitment of coop board is key to the success of the project.

• T&T and QBMP instill discipline to delivery good quality raw milk.

• Competition amongst milk buyers & hawkers limits success of

implementation, e.g. rejected milk goes to the competitors.

• For effective cooling, use of plate heat exchanger is desirable.

• Time span to implement a QBMPS depends on many factors e.g.

poverty, priorities etc. and requires several years (behavior change).

• Premium payment can be a big driving factor for success of pilot.

• It achieved antibiotic residues reduction from incidental >35% to an

average of <4%, but bringing down Total Plate Count goes slow.


Food safety has no boundaries!!!

Thanks for listening11/26/2017 Teresiah Ndungu, Happy Cow- ESADA SA 38

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