Milk in the urban market

In September 1998, thirty four men involved in small-scale dairy production in the Ethiopian town of Debre Zeit set up a dairy association. Owning on average more than twenty animals each, together they were able to pool and sell milk from over 700 milking cows. In 2003 that same association has over 540 members. The average number of cows per member has shrunk to less than four; 248 of the members are women. Together these smallholders are collecting and selling over 6000 litres of milk per day, and are currently applying for funding for a 10,000 litre capacity processing unit so that they can supply quality dairy products, including butter, cheese and ice-cream, to urban consumers in towns up to 100 miles away. For the peri-urban cattle owners of Debre Zeit, milk production is a booming business.

Wastes and fasts
For individuals who lack the opportunity to join a dairy association, earning good money from small scale milk production tends to be an uphill struggle. The time and effort required for selling small quantities of milk are relatively great, and prices in rural areas tend to be low. With an extremely short 'shelf life' when not properly cooled, much that is not sold immediately is wasted, and in Ethiopia this problem is compounded by religious observance. Followers of the Ethiopian Orthodox church, which accounts for most of the population, abstain from all animal products, including milk, butter and cheese, on approximately 150 days of the year, including two full months before Easter. For smallholders who lack the capacity to keep their milk cool, let alone pasteurise or process it, this average of nearly three fasting days per week represents an enormous loss in income.

Little surprise then that so many farmers in and around Debre Zeit have been keen to join the milk association, which offers a way to overcome these difficulties. For a cost of 100 birr (approx. US$10) members buy a share in the co-operative. They can then bring their milk to one of seven collection points in the district twice a day, every day, and receive payment every two weeks according to the number of litres supplied. Amounts brought to the collection centre each day vary considerably; some bring just a few litres, others over a hundred. Before the milk is accepted and logged, it is checked for microbial quality and for any evidence of adulteration or de-fatting. With only very limited processing capacity - two butter churns and a cream separator - the bulk of what is collected must be sold as fresh milk. However, because of the guaranteed quality of their product, the group earns a comparatively high price from sales in town, and because of the high volumes collected are able to supply an industrial dairy plant near Addis Ababa, a vital arrangement during the days of fasting. Last year the group raised enough profit to buy a small truck and a 5000 litre cooling tank to transport the milk.

Strength in numbers
The success of the dairy group has been such that its five hundred plus members now constitute a major economic force in the town. With this financial muscle the association is able to secure animal health and artificial insemination services, and obtain feed concentrates and other inputs at competitive prices. Improved livestock management has boosted production levels, such that currently the 543 members supply around 6500 litres of milk per day to the collection centres. And beyond these financial benefits, the dairy co-operative model has other implications for development. Urban and peri-urban dairy industries raise environmental and health issues, not least from the build up of waste products. Centralised milk collection and processing offers a much better chance of addressing these kinds of problems, reducing environmental hazards and health risks for urban populations and milk consumers. Uniting milk producers in a group also makes it easier to develop and enforce rules, for example over grazing rights or stocking densities.

Researchers from the International Livestock Research Institute (ILRI) stationed at Debre Zeit, who have been advising the co-operative, are keen to see the benefits now enjoyed by cattle owners close to the town being spread to more distant areas. Linking rural communities with urban consumers should enable them to move beyond subsistence production and take a bigger role in the market economy. The association is also keen to expand its activities, and is in the process of establishing eight more collection centres, including several in remoter parts of the district. The target is to collect 10,000 litres of milk per day; funding applications are currently being made to buy cooling, pasteurising and processing equipment, and ILRI has trained over 100 members of the co-operative in dairy processing. If the funds are made available the group plan to supply other urban centres in the Rift valley, as far away as Awassa, 100 miles to the south. ILRI staff are confident that lessons learned from the Debre Zeit group pave the way for the establishment of many more dairy associations in other parts of the country. In time, these could offer a significant income-generation and employment opportunity to Ethiopia's poorer communities.