Presented by Dirk Hoekstra, Azage Tegegne, Berhanu Gebremedhin, Aklilu Bogale and Yasin Getahun at the 21st Annual Conference of Ethiopian Society of Animal Production (ESAP), Addis Ababa, 28-30 August 2013

1. LIVES dairy value chain development: Distinguishing
between fluid milk and butter channels
Dirk Hoekstra, Azage Tegegne, Berhanu Gebremedhin, Aklilu Bogale and Yasin Getahun
21st Annual Conference of Ethiopian Society of Animal Production
(ESAP), Addis Ababa, 28-30 August 2013

2. LIVES Zones/Districts selected for dairy value
chain development

3. Assessment dairy value chains

4. LIVES Dairy value chain system
Research Education
POLICY
Input
Producer/
Supplier
Output
Producer
Trader/
Processor
Value chain actors
Knowledge and capacity service providers
Public and
private
service &
input
suppliers

5. Rapid assessment dairy value
chains
PA/Districts Zonal Regional/federal
Production X
Input/services X X X
Processing/market
ing
X X X
Knowledge &
capacity
X X X
Policy X

6. Community (PA) baseline data
• Sample PA level data from potential dairy
Districts/PAs
– 8 Zones
– 25 Districts
– 368 potential rural PAs
– 93 sample PAs
• Focus group discussions,
• Key informant interviews,
• Review of agricultural records of the district Office
of Agriculture (OoA) and Kebele administration,
• Records held by development agents (DAs), and
other sources

7. Household level base line data
• Questionnaire developed
• Implementation scheduled for Sept to
Dec

8. Findings

9. Relative importance of fluid milk and butter
system in LIVES dairy sample PAs
Revenues
Milk Sales
19%
Revenues
Butter Sales
81%
Sales Revenues
No of HH selling dairy products
Key role women in butter
processing and sale

10. Spatial distribution fluid milk and butter
system in LIVES sample PAs
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
< or = 1 hr > or = 1 hr
Revenue of milk sold (Birr)
Revenue of butter sold (Birr)

11. Key production findings/constraints
• Limited number of improved cows
• Poor fertility management - long calving
intervals
• On farm feed production/collection/storage
and treatment inadequate
• Limited use of supplementary feeding
• High incidence of diseases leading to reduced
production and food safety problems
• Roles man and women in production based
on traditional systems, but evolving

12. Key input supply and services
findings/constraints
• Inefficient AI service system, concentrated
around major milk consumption centers
• Inadequate supply of supplementary feed
and sales outlets
• Poor grazing system land management
structures
• Access to services and inputs by man and
women still based on traditional
systems, but evolving

13. Key processing/marketing findings
constraints
• Price ratio butter/milk = 1 to 16
• Conversion rate milk/butter local breeds 16/1
• Local butter processing farm based
(women), private sector involvement in
purchase and sales
• Insufficient collective and private action to
purchase and process fluid milk
• Access to and role man and women in
processing and marketing based on traditional
systems, but evolving

14. Key knowledge and capacity
development findings/constraints
• Inadequate linkages between dairy value chain
partners
• Inadequate market oriented extension services
• Inadequate research system for action research
• Insufficient involvement educational system in
development activities
• Access man and women to knowledge and
skills based on traditional systems, but evolving

15. Key policy findings/constraints
• Government policies/strategies emphasize
market orientation
• Various government/NGO
initiatives/programs to address constraints
• Lack of overall livestock dairy development
strategy
• Inadequate harmonization of dairy
development activities

16. Dairy value chain development
strategies

17. Three spatially different dairy
systems
• Farms within 1 hr walking distance from
major consumption centers (pop >5000)
• Farms within 1 hr partly motorized travel
distance from major consumption centers
• Farms more than 1 hr partly motorized
travel distance from major consumption
centers

18. Use of GIS to determine spatially
different dairy systems
• Travel time models to main consumption
centers (> 5000 population)
• Walking speed humans 5km/hr
• Speed modifiers
– Slope – fixed
– Land use - fixed
– Road network – variable for different scenarios
• Walking only scenario: all roads 5 km/hr
• Partly motorized scenario: primary roads 40
km/hr, other roads 5km/hr.

20. Farms within 1 hr walking distance from
major consumption centers (pop >5000)
• The short term development strategy
would be to assist producers and other
value chain actors in improving their fluid
milk and local butter production/marketing
system. The longer term strategy will be to
focus on fluid milk value chain
specialization.

21. Farms within 1 hr partly motorized travel distance
from major consumption centers
• The short and long term strategy for such
areas is to build up the fluid milk marketing
system while maintaining/improving the
butter marketing system. A critical factor for
the implementation of this strategy will be
collective action (bulking, cooling) of milk
and transportation interventions.

22. Farms more than 1 hr partly motorized travel
distance from major consumption centers
• The short and long term project
development strategy for these areas is
focusing on commercial sale of butter, while
fluid milk can be used for domestic
consumption to improve the livelihood of
farmers.

23. Dairy value chain development
interventions

24. Key production value chain
interventions
• Appropriate on farm breeding and fertility
management depending on development direction
(breeds, nutrition, heat detection)
• Improved on farm production of forages
– Grazing areas
– Crop residues
– Planted fodder
• Improved use of produced fodder
– Conservation (hay/silage)
– Treatment (chopping, urea/molasses)
• Improved production methods –
feeding, housing, milking hygiene, health

25. Key input/service supply
interventions
• Introduction of hormone assisted mobile
mass insemination system
• Strengthening/establishing of agro business
dealerships for supply of feeds/veterinary
drugs thru coops and private businesses
• Creating linkages between producers and
agro businesses
• Development of public (FTCs) and private
forage seed multiplication system
• Establishing improved management systems
for communal grazing areas

26. Key processing/marketing
interventions
• Promotion of dairy product consumption
• Fluid milk processing marketing
– Stimulate collective and private action to purchase
and process milk within the 1 hr travel distance
– Improve milk quality – milk collection
cans, cooling, quality testing, certification of
vendors
• Butter processing marketing
– Stimulate collective and private action for butter
processing by women
– Explore collective action for sale of butter

27. Key knowledge and skills
development interventions
• Creation of linkage mechanisms between dairy
value chain actors at and between different levels
• Use of ICT based information systems, technologies
• Contribute dairy value chain development info thru
EAP and promotional activities
• Use of market oriented extension system, based on
gender equity, sustainable environment and
entrepreneurial small holders
• Use of skills and knowledge on improved
production and processing technologies

28. Key policy development contribution
• Contribute to livestock strategy/policy
development
• Contribute to dairy program
harmonization
• Participate in dairy value chain for
a, including Dairy Board

29. Summary conclusion
• Avoid blanket approach to dairy value chain
development
• Pay attention to local butter value chain
• While the use of genetically improved animals is
key to the development of dairy value
chains, additional production, input/service and
processing/marketing , capacity/knowledge
interventions and policy contribution are required
to reap the full benefits