Linking small dairy producers to dynamic markets: three business models from Kenya


by Jo Cadilhon | March 20, 2015

In November last year, the Livestock and Fish CGIAR Research Program commissioned an external evaluation of its value chain approach. One of the evaluators’ main concerns was that researchers spent their time analyzing how the livestock and fish value chains were working from an economics perspective but little work had been done on characterizing successful business models for farmer’s group organization and value chain governance, which are more likely to lead to more meat, milk and fish by and for the poor. 

Livestock and Fish has started taking this business development angle with research on existing dairy hubs in the Tanzania value chains. This post aims to keep the ball rolling on this topic of business models for linking smallholder livestock farmers to dynamic markets by an overview of three dairy marketing business models that I visited last year in Kenya.

There was a flurry of dairy knowledge sharing events in Kenya late last year. The International Livestock Research Institute (ILRI) and the Technical Centre for Agriculture and Rural Cooperation ACP-EU (CTA) organized the African Dairy Value Chain Seminar from 21 to 23 September. This was followed by the Annual dairy conference of the East and Southern Africa Dairy Association (ESADA) from 24 to 26 September. And from 27 to 29 October, more dairy experiences were shared at the 6th All Africa Conference on Animal Agriculture.

All three events involved field trips to meet stakeholders in the Kenyan dairy value chains. In the course of one month, I was able to hear about three different dairy business models linking smallholder dairy farmers to dynamic markets. I felt that all three were successful to foster market access. This blog post summarizes the lessons learned from these field visits in terms of 1) models for smallholder inclusion into value chains, 2) encouraging investment into dairy value chains, and 3) gender roles and empowerment in African dairy value chains.

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This story originally appeared in the Livestock and Fish blog. The introductions is cross-posted with minor modifications and from the author's permission. Jo Cadilhon is a senior agricultural economist at International Livestock Research Institute (ILRI) and a member of the PIM Value Chains team under research flagship 3.

Featured image: Youth milking on a dairy farm in Machakos, Kenya (photo credit: ILRI/Brad Collis), Flickr