more milk in tanzania: entry points for extending the frontiers of dairy value chains in tanzania...
DESCRIPTION
Presented by A. Omore, L. Kurwijila and S. Nandonde at the Tanzania Society of Animal Production (TSAP) Conference, Arusha, 23-26 October 2012TRANSCRIPT
More Milk in Tanzania Entry points for extending the frontiers of dairy
value chains in Tanzania through hubs
Presentation at TSAP Conference A. Omore, L. Kurwijila and S. Nandonde
35th Tanzania Society of Animal Production (TSAP) Conference, Arusha, 23-26 October 2012
BACKGROUND: Projections indicate demand to 2020 outstrips supply
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20201,000,000,000
1,500,000,000
2,000,000,000
2,500,000,000
3,000,000,000
3% GDP Growth 2% GDP Growth Milk ProductionYear
Million Lts Milk/ Yr
Dairying in EA is the most important ag sector commodity for GDP gains in the medium term (ASARECA/IFPRI report)
BACKGROUND: Large Yield Gaps
0
1000
2000
3000
4000
5000
6000
Milk
yie
ld p
er L
acta
tion
(Kg)
Indigenous Crossbred Exotic
Mixed rain fed temperate/ highlan
d
Mixed rain fed humid/ sub-humid
Indigenous Crossbreds Synthetics Exotics
Large-scale commercial ranches
x1
x2
x3
x1
x2
x3 x3
y2
y1
x3
Xi = Yield gaps due to “animal husbandry practices” : 33 - 76 %Yi = Gap in productivity due to “genotype”: 18 - 74%
Source: Mwacharo et al., 2009
CONTEXT
Goal: To sustainably increase the productivity of small-scale livestock and fish systems to increase the availability and affordability of animal-source foods for poor consumers and, in doing so, reduce poverty through greater participation by the poor along the whole value chains for animal-source foods.
CGIAR Research Program on: More milk, meat and fish by and for the poor (LaF) is one of 15 CRPs in a re-organized CGIAR system
Strategic LaF Cross-cutting Platforms• Technology Generation• Market Innovation• Targeting & Impact
Inputs & Services Production Processing Marketing Consumers
R4D integrated to transform selected value chains In targeted commodities and countries.
Value chain development team + research partners
GLOBAL RESEARCH PUBLIC GOODS
INTERVENTIONS TO SCALE OUT REGIONALLY
Addressing the whole value chain to transform the sector over a decade
Major intervention with development partners
Approach: Solution-driven R4D to achieve impact
LaF:
Pre
pare
inte
rven
tion
Development Partners$90m
Performance Target:double production in x poor households Scaling out
Knowledge Partners $10m
Time 10 years
LaF: Strategic Research $10m
Working toward interventionsfor impact at scale
1 Technology development:
− Genetics− Feeds− Health
Inputs & Services Production Processing Marketing Consumers
Commodity X in Country Y
2 Value chain development
3 Targeting: Foresight, prioritization, gender, impact
Cross-cutting: M&E, communications, capacity building
Delivering Livestock + Fish Programme
Structure: Three integrated Components
9 Target Value Chains
PIGS
AQUACULTURE
SHEEP & GOATS
DAIRY
Website for news updates on subscription: http://livestockfish.cgiar.org/
LaF Catalyst Role
Research
Investors
NARS
ARIs
LaFCG partners
Ministry
Investors
Development
NGOs
Private Sector
Website for news updates on subscription: http://livestockfish.cgiar.org/
Links to other CGIAR Programs (CRPs)
Current and anticipated CGIAR linked dairy VC projects in Tanzania in 2012
1. MilkIT: Promoting feed innovations ILRI/CIAT/TALIRI/SUA; IFAD 2. MoreMilkIT: Adapting dairy market hubs: ILRI/SUA/TDB; Irish Aid3. Safe Food Fair Food (SFFF2); - ILRI/SUA; BMZ 4. Livestock Data Innovation (LDIP) – MLDF/FAO/ILRI; BMGF/WB funded5. Integrated Crops and Goat project (CGP) – SUA/UA/ILRI; IDRC 6. EADD – HPI/TNS/ILRI/ICRAF/ABS; BMGF7. Equitable access to animal source foods - ILRI/WFC/SUA - AUSAid
Main challenge for solution driven research for development :
• How can research be more responsive?
• How can research deliver value beyond knowledge?
• How can research serve development in real time?
Entry points for More Milk in Tanzania Project: Key considerations
• Strong focus on pro-poor marginalised pre-commercial men and women and ‘growing’ inputs and outputs markets that serve them
• Explore new organizational models to achieve economies of scale
• Aim is to provide proof-of-concept on how marginalised groups can also be targeted successfully
• Generate evidence for influencing policy
Following are highlights of dairy VC R4D engagement and findings on entry points since Jan 2012
Objectives (derived from ASDS and Irish Aid Country Strategy Paper for Tanzania)
Goal: Inclusive growth and reduced poverty and vulnerability among dairy-dependent livelihoods in relevant rural areas in Tanzania
Outcome: Rural poor are more income secure through enhanced access to demand-led dairy market business services and viable organisational options
Contributing objectives:– Develop scalable value chains approaches – Generate and communicate evidence on business and
organizational options – Inform policy on appropriate role for pro-poor smallholder-
based value chains
More Milk in Tanzania Project
Addressing 5 inter-related problems that face resource-poor milk producers
1. Dominant direct milk sales of small volumes. This precludes economies of scale ↑costs
2. Credit facilities are lacking. This contributes to low access to basic inputs and services or working capital to purchase them
3. Lack of appropriate organizational models for pre-commercial producers. These are required to facilitate collective action
4. Seasonality of rainfall and related effects are strong
Milk marketing outlets (NBS, 2003)
Milk Buyer%
Neighbours 86.1
Local market 5.5
Secondary market 0.5
Processors 1.4
Large scale farms 0.2
Trader at farm 4.5
Other 1.7
TOTAL 100.0
More Milk in Tanzania Project
Addressing 5 inter-related problems that face resource-poor milk producers
More Milk in Tanzania Project
Women participate more where there’s no collective milk bulking and marketing
1. Dominant direct milk sales of small volumes. This precludes economies of scale ↑costs
2. Credit facilities are lacking. This contributes to low access to basic inputs and services or working capital to purchase them
3. Lack of appropriate organizational models for pre-commercial producers. These are required to facilitate collective action
4. Seasonality of rainfall and related effects are strong
Addressing 5 inter-related problems that face resource-poor milk producers
More Milk in Tanzania Project
1. Dominant direct milk sales of small volumes. This precludes economies of scale ↑costs
2. Credit facilities are lacking. This contributes to low access to basic inputs and services or working capital to purchase them
3. Lack of appropriate organizational models for pre-commercial producers. These are required to facilitate collective action
4. Seasonality of rainfall and related effects are strong
Addressing 5 inter-related problems that face resource-poor milk producers
More Milk in Tanzania Project
Milk processing in Tanzania has been declining since 19901. Dominant direct milk sales of
small volumes. This precludes economies of scale ↑costs
2. Credit facilities are lacking. This contributes to low access to basic inputs and services or working capital to purchase them
3. Lack of appropriate organizational models for pre-commercial producers. These are required to facilitate collective action
4. Seasonality of rainfall and related effects are strong
Addressing 5 inter-related problems that face resource-poor milk producers
More Milk in Tanzania Project
1. Dominant direct milk sales of small volumes. This precludes economies of scale ↑costs
2. Credit facilities are lacking. This contributes to low access to basic inputs and services or working capital to purchase them
3. Lack of appropriate organizational models for pre-commercial producers. These are required to facilitate collective action
4. Seasonality of rainfall and related effects are strong
Huge seasonal fluctuation in milk supply from traditional herd
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0
1000
2000
3000
4000
5000
6000
7000
8000
9000
10000
11000
12000
Milk collection by a small scale processor from traditional herd in Morogoro, 2009
Average/month Total supply
Month
Vo
lum
e o
f m
ilk
(lit
res/
mo
nth
)
More Milk in Tanzania Project
Huge seasonality in milk supply from the indigenous vs. improved dairy cattle
09/04/2023 NAI/EGM/Mara Region/Kurwijila 21
More Milk in Tanzania Project
Less rainfall variation in highlands
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec0
5
10
15
20
25
30
Lowland/extensive
Highland/semi-intensive
More Milk in Tanzania Project
Less seasonal milk yield fluctuation with better feeding
January
Febru
ary
Marc
hApril
May
June
July
August
September
October
November
December
-
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
14,000.00
16,000.00
20092010Average
More Milk in Tanzania Project
Source: SUA dairy research farm)
Farmer groups are struggling in most places except in Tanga
Performance of milk collection at Nnronga women dairy co-operative Society, Hai
Kilimanjaro and CHAWAMU-Muheza Tanga (1994-2007)
050000
100000150000200000250000300000350000400000450000500000550000600000650000700000750000
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Year
Volu
me
of M
ilk (L
itres
)
Nnronga
CHAWAMU-Muheza
More Milk in Tanzania Project
Entry Points:Spatially overlays was the initial step….
Prod systems: arid to humid/temperate
Persons/sq km (25)
+ =
Map A: Mixed prod sys + ↑pop
Map A Market access (0.5& 5hrs) Maps B & C : Mixed prod sys + ↑pop + ↓ & ↑ market access: = R-R & R-U
+ =R-U
R-R
More Milk in Tanzania Project
Maps B : Mixed prod sys + ↑pop + ↓ market access: = R-R
R-R
Maps C : Mixed prod sys + ↑pop + ↑ market access: = R-U
R-U
Identified entry points in the field Maps + stakeholder consultations
Region District Market access classification
Cattle population*
% improved dairy breeds
Dominant production system
Morogoro
Kilosa R-to-R 215,100 1 Extensive/Agro-pastoral (zebu)
Mvomero R-to-U 187,350 5 Extensive/Agro-pastoral (zebu) with significant semi-intensive & intensive (improved)
Tanga
Handeni R-to-R 126,780 1 Extensive/Agro-pastoral & Extensive/Sedentary (all zebu)
Lushoto R-to-U 119,492 24 Extensive/Sedentary (zebu) with significant semi-intensive & intensive (improved)
More Milk in Tanzania Project
Detailed value chain assessments have been conducted at these sites
Morogoro: Kilosa and MvomeroMore Milk in Tanzania Project
Tanga: Lushoto and HandeniMore Milk in Tanzania Project
Which Hub Model might be appropriate?
- -
- -
Chilling Plant Processing PlantCollection
Center
Sales to individuals andvendors
Sales to Processor
Diversified profit max through:higher prices for milk sold locallylower costs (transport, chilling) overall for milk handled
- -
Diversified Profit-Max Model for CPs
Some EADD Hub Models being tested
More Milk in Tanzania Project
Hubs are localized groups of smallholder producers with common interests in accessing inputs (feed, breeding, animal health) and services (training, credit, insurance), as a means to achieve a critical mass of supply
Dairy Market Hubs (DMHs) with emphasis on improving access to inputs and services through business development services (BDS) and check-off arrangements:
a) DMHs revolving around chilling plants or accessing them (if under-utilized) through transport arrangements that provide both outputs marketing and inputs and services through check-offs; b) DMHs revolving around check-offs for inputs and services provided through milk traders; and c) DMHs revolving around check-offs for inputs and services provided through cattle traders.
Outcome Mapping identified the following hubs for piloting in the Tanzania context
More Milk in Tanzania Project
Producers In
puts, $$
Inputs & services
$$
Payment agreement
Milk, C
attle
Check-off agreement
Inputs & Service Providers
Traders Milk Cattle
BASIC Dairy Market Hub
for Provision of Inputs and Services on Check-off
Illustration of a hub for provision of inputs and services on credit without collective bulking and marketing
Targeting 50 villages with 8000 cattle keepers across 4 districts
Strategic Cross-cutting Platforms• Technology Generation (Feed, genetics, health• Market Innovation• Targeting & Impact (includes gender)
Inputs & Services Production Processing Marketing Consumers
Design of integrated R4D to extend the frontiers of dairy value chains to achieve wider impact in Tanzania
Value chain development team + research partners
INTERVENTIONS TO SCALE OUT NATIONALLY
Addressing the whole value chain with downstream emphasis
Intervention with development partner
Cross-cutting: M&E, communications, capacity building
Baseline for M&E planned for Dec 2012
Integrating other actors into the Tanzania dairy value chain R4D
Research
Other Investors
(e.g., IFAD BMZ)
SUA /TALIRI
Irish institutions
ILRI /Other CG partners
MLDFTDB, other
NGOs (DDF)
Investors (e.g., BMGF)
Development
Dev Partner
NGO
Private Sector
Organogram of DDF and stakeholder linkages
Dairy Development Forum
Secretariat: Tanzania Dairy Board
Stakeholder organisations
Academic & res institutions
Dairy development organisations
Membership organisations
Govt Private sector
Advisory Committee
Civil society
Key messages on entry points
• Validity of the need to focus attention on ‘growing’ the existing informal system of milk production (with zebu cattle) and marketing to extend the frontiers of commercial dairying
• New organizational models to achieve economies of scale for access to inputs and services required to unleash incentives for raised productivity to levels that will justify bulking
• This is riskier than classical approaches but more inclusive and promises wider impact on marginalised
• Policy support for pro-poor shift needed
More Milk in Tanzania Project