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“ Break Even Analysis for Smallholder Dairy Keeping Practice in Mvomero and Kongwa Districts, Tanzania.”. J. R. Makindara, E. M. Mpelangwa and D. Shayo. Presented at the Canadian International Food Security Research Fund (CIFSRF) “Research to Feed Africa” Symposium

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  1. “Break Even Analysis for Smallholder Dairy Keeping Practice in Mvomero and Kongwa Districts, Tanzania.” J. R. Makindara, E. M. Mpelangwa and D. Shayo Presented at the Canadian International Food Security Research Fund (CIFSRF) “Research to Feed Africa” Symposium June 23-27 , 2014, Great Rift Valley Lodge, Naivasha, Kenya Sponsored By: Hosted By:

  2. Presentation Outline • Background Information • Problem Statement and justification • Objectives of the study • Methodology • Findings • Conclusion • Recommendations Sponsored By: Hosted By:

  3. Background Information • The dairy goats have been realized to have potential to eradicate rural malnutrition and poverty (Njombe et al, 2011). This potential has attracted various development and research agents such as Farm Africa, Heifer International, Sokoine University of Agriculture (SUA) and other religious organizations to invest in the development and promotion of dairy goats in Tanzania (Mpelangwa, 2013). Sponsored By: Hosted By:

  4. Background info cont… • These goat development programs have resulted in increased dairy goat population in Tanzania from 40 000 in 2005 to 120 000 in 2010 (Lie, 2011; Peacock and Hastings, 2011). • Currently, the total goat population in Tanzania is about 15.2 million (Njombe et al, 2011) with improved breeds being 1.6% out of which 58% are dairy goats (Lie, 2011). Sponsored By: Hosted By:

  5. Problem Statement and Justification • Goat production in Tanzania represents an opportunity for local value chain development while playing a significant role in supporting smallholder farmers in improving their livelihoods (Lie et al, 2012). • Goats are tolerant to limited food and water access, their herds can recover quickly due to fast reproduction cycles, and, because of their small size, are easy to transport (Peacock 2007 as quoted by Lie et al, 2012). Sponsored By: Hosted By:

  6. Problem Statement cont… • Despite these advantages, very little has been done to determine the number of dairy goats that a small holder can keep for a profitable venture with little additional investment. • The researches that have been done include profitability analysis (Chenyambuga et al, 2014), market and economic performance (Mpelangwa, 2013) and value chain development (Lie et al, 2012; Lie, 2011). Sponsored By: Hosted By:

  7. Problem Statement cont… • Therefore, none of these studies have determined break even analysis under small holder dairy farming which can provide a guide for a minimum number of dairy goats to be kept in order to break even. • Hence, it is in this context that this study was undertaken in order to fill this gap. Sponsored By: Hosted By:

  8. Objectives of the Study • The overall objective of this study was to determine a number of dairy goat to be kept under small holder farming in order to break even. Sponsored By: Hosted By:

  9. Methodology • The study areas were Kunke and Wami-Luhindo villages in Mvomero district and Ihanda and Masinyeti villages in Kongwa district. • The area was chosen because of the introduction of dairy goats (Toggernburg and Norwegian breeds) in the villages through Crop and Goat Project (CGP) implemented jointly by SUA, UA, ILRI and KSRI under IDRC Funding. Sponsored By: Hosted By:

  10. Methodology cont… Sponsored By: Hosted By:

  11. Methodology cont… • The research design was cross sectional with sampling units being small holder farmers who were given goats by the CGP project. • Sampling procedure used was purposive in selecting the villages and the farmers involved in the study. • Total sample size was 91 whereby 21 were from Kunke village, 17 from Wami Luhindo village, 24 from Ihanda village and 28 from Masinyeti village. Sponsored By: Hosted By:

  12. Methodology cont… • Data collection methods was interviews. • Data collection instruments was a questionnaire. • Data were analyzed using SPSS for questionnaire. • Data analysis were descriptive statistics and break even calculations. Sponsored By: Hosted By:

  13. Findings • Sex of Respondents Sponsored By: Hosted By:

  14. Findings cont… • Marital status the Respondents Sponsored By: Hosted By:

  15. Findings cont… • Building of goat house Sponsored By: Hosted By:

  16. Findings cont… • Feeding the goats Sponsored By: Hosted By:

  17. Findings cont… • Cleaning of goat house Sponsored By: Hosted By:

  18. Findings cont… • Milking of goats Sponsored By: Hosted By:

  19. Findings cont… • Break Even Analysis • The formula for BEP is as follows: • Q = FC / (UP - VC) • where: • Q = Break-even Point, i.e., Units of production (Q), • FC = Fixed Costs (Tshs) • VC = Variable Costs per Unit (Tshs) • UP = Unit Price (Tshs) Sponsored By: Hosted By:

  20. Findings cont… • Note: • Milking of goats is done once per day (morning only), • Fixed costs considered was of goat house, since dairy goat was given by the project, i.e. 44, 886 Tshs (Average), • Variable costs considered was of feeding, supplements and veterinary service, • Price of milk was 1200 Tshs per litre, and • The calculation was based on 3 months only of milk production under 2 goats per house. Sponsored By: Hosted By:

  21. Findings cont… • Break Even Point Calculations: • Qm = 500 / (1000-(300+90+182) • Qm = 1.16 Litres of milk per day • Note: • All costs have been computed per day. Sponsored By: Hosted By:

  22. Findings cont… • Break Even Point Calculations: • Since average daily milk production was 0.5 to 1 litre per day, and the production was based on 2 goats per household for three months, • Then BEP goats per household per year will be Qg = 1.16*2*3 • Qg = 7 – 8 Sponsored By: Hosted By:

  23. Conclusion • Dairy goats can be a profitable venture after two years in operation if other factors such as good husbandry, provision of supplements and animal health services are taken care of. Sponsored By: Hosted By:

  24. Recommendations • Dairy goat technology development programs should adoption introducing 2 or more goats per household strategy which shows profitable results within a short period of time to the target beneficiaries. Sponsored By: Hosted By:

  25. Acknowledgements • This is the end of presentation and we would like to acknowledge the following: • IDRC/CIFSRF for sponsoring the symposium, • KARI for hosting, • IDRC/CIRDI for funding the study and • Sokoine University of Agriculture and University of Alberta for coordinating the study. Sponsored By: Hosted By:

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