Liquid Milk and Feed Value Chain Analysis for Wolmera District

1. Liquid Milk and Feed Value Chain Analysis for Wolmera District Dairy Team Holeta Agricultural Research Center

2. Introduction Wolmera woreda is among the highland areas categorized under the Addis Ababa dairy milk shed It has conducive agro-ecological conditions suitable for improved dairy animals Its proximity to the large consumer base in Addis Ababa Dairy is an important means of livelihood for the farmers in the area There are different market outlets for liquid milk: cooperative unions, processors and private traders The purpose of this study is to understand the dairy value chain test tools developed for this purpose

3. Objectives The major objective of this study is to assess fluid milk and feed value chain in Wolmeraworeda . It is conducted with specific objectives of: (a) understanding the core functions and major actors involved in each value chain (b) Identifying major constraints and opportunities in each value chain (c) Testing and further refining of the VCA tool for wider scale use in the future.

4. Results of Value Chain Analysis

5. Core functions and activities in the fluid milk value chain Processing Input supply Production Raw milk marketing Retailing Consumption Selling Transporting Quality assessment Milk chilling Pasteurization Packaging Products making Quality assessment • Semen • Bulls • Feed ingredients • Land • Labor • Seed • Drugs cow rearing Feeding Milking Quality assessment Collection Refrigeration transportation Delivery to processors

6. EnablingEnvironment Land availability Rules and Regulations Drought Hotels and restaurants Institutions Consumption Households Retailing (processed milk) Super markets Small shops Processing Small scale processors Processing plants Raw Milk Marketing Individual traders Collectors of milk processing plants Unions/coops Production Smallholder dairy farmers AI services Credit services Seeds supply Extension services Vet services Knowledge & Skills Input Supply Fluid Milk VC Actors and Major Channels

7. Major milk marketing channels identified • Channel 1: Total milk produced retained for home consumption • Channel 2: Milk reaching the consumers through formal marketing • Channel 3: Milk reaching the consumers through informal market

8. Core functions and activities in the feed value chain Processing Marketing Consumption Input supply Production • land preparation • planting • weeding • harvesting • Feed Formulation • Treatment • Supplementation • Feeding • seed supply • Supply of fertilizers • Supply of wheat, noug, linseed, cotton seed etc • Baling • Stacking • Storage • Grinding/crushing • Mixing • Branding • Packaging • Transportation • Storage • Retailing • Distribution • Quality assessment

9. Rules and Regulations EnablingEnvironment Land availability Drought Feed VC Actors and Major Channels Consumption Urban & peri-urban farmers Small holder rural farmers Institution/colleges, research centers etc Marketing Unions/coops Traders Production Agro-processing industries Smallholder farmers Extension services Provision of Planting materials & fertilizer Credit services Technology Input Supply

10. Channels Identified for Feed • Channel 1: Total feed produced and retained for own consumptions • Channel 2: Feed produced reaching the producers through traders • Channel 3: Feed produced reaching terminal markets with/out coops/unions Constraints along the milk value chain Input Supply • Shortage of feed supply • Poor quality feed • Lack of awareness about feed formulation • Inadequate supply of improved dairy stock and AI • Inefficient AI and vet services • Shortage of vet drug supply • High interest rate and demand for collateral for credit

11. Production • High investment cost to start dairy farms • High feed cost • Low productivity of dairy cattle • Poor management skill from milking to selling • Lack of training in dairy production and management Processing • Shortage and seasonality of raw milk supply • Supply of poor quality milk to processors • Low technical skill of staff • Poor marketing in labeling and distribution • High cost of packaging

12. Marketing • Long distance poor road infrastructure to reach markets • High cost of transportation • Lack of chilling facilities (most of the traders) • Improper milk packing and handling • Shortage of processed milk for distribution Consumption • Long fasting days of the Orthodox Christian followers • Wrong assumption that milk is meant only for kids • High milk price • Lack of consumers’ knowledge on milk quality • Low enforcement of milk quality standards

13. Constraints in feed value chain Input Supply • Land shortage • Shortage of seed and other planting materials • Lack of training on forage production and pasture management • Shortage of raw materials for agro-industries and feed processing plants Production - Low productivity of pasture • Lack of forage production skill • In-effcient feed preservation practices • High cost raw materials for agro-industries and feed processing plants Processing • Few processing plants that are congested around Addis • Most of them operate under their installed capacity • Vat + other taxes on feed • No quality control on feed

14. Cont’d Marketing • Seasonality in availability and price of feed • High transportation costs • Non market oriented production of improved forage and seed • Absence of feed quality control in the market • Few actors monopolizing the concentrate feed market Consumption • High feed price • Shortage of supply • Lack of awareness on improved feeding • High adulteration • High transportation cost • Low level of understanding of feed quality by consumers

15. Opportunities identified • Suitable agro-ecology for dairy & feed production • High domestic and export demand for milk & feed • Large number of emerging dairy and feed processing industries • Availability of relatively cheaper labor force • Strong government support • High population growth with better income and demand for better quality food • Expanding livestock industry with high demand for better quality feed • Good and reliable road connectivity

16. Lessons Learned • The VCA tool for dairy should have been developed separately • The feed and dairy value chains should have been studied independently of each other • VCA demands more time and well organized group

17. Filed level Monitoring Evaluation

18. Thank you !!