Pursuing money in milk

Dairy farmer in Thyolo District. Photo: Louis Suwedi

Joyce Ntikhe, 41, is a budding dairy farmer at Chipendo village in the area of Traditional Authority January in the southern district of Thyolo, Malawi. A few years ago, she invested in her first dairy cow as a way of making money for herself and her family. Today, Joyce has three cows and hopes to increase the size of the herd in the coming years. While dairy farming has helped support her household, it does not provide enough always.

Cost of feed is high and efforts to get it are costing farmers a lot of time and money, especially during the dry season. Therefore, production is low and proceeds from milk are not adequate, and farmers cannot afford to drink milk themselves. Being a small farmer in a remote area, farmers like Joyce rely on established processors to sell the milk they produce. Like other small-scale dairy farmers in Malawi, markets remain a challenge.

“This area has many small-scale farmers but our challenge remains good markets. Some buyers offer us as little as MK 195 ($0.25) per liter. This is very little compared to how much we need to feed and treat the cows,” says the farmer, a mother of 5 children and owner of 3 dairy cows.

A group of entrepreneurs turned into a cooperative for farmers in the area to offer solutions to this challenge. Umodzi Milk Processors Cooperative, a group of 168 milk processors, is now creating a new market for farmers in the area.

Testing milk for quality at delivery, Bumbwe cooperative. Photo: Louis Suwedi

With support from the European Union-funded Crop-Livestock Integration and Marketing in Malawi (CLIM²), a project implemented by the International Crops Research Institute for the Semi-Arid Tropic (ICRISAT), Small Scale Livestock and Livelihoods Programme (SSLP) and the International Livestock Research Institute (ILRI), they have been organizing themselves to grow into a vibrant cooperative.

Sabine Homann-Kee Tui, Coordinator for the CLIM² project, explains that the project’s goal is to increase income and livelihoods for small holders and rural business entities, rural poor and rural youth through sustainable intensification and diversification of affordable plant and animal-based food production and value chains.

Thyolo District is the largest producer of milk in Malawi. Despite this, communities are only selling raw milk which does not bring same returns as processed milk would. “We sell a lot of milk here yet we cannot get yoghurt or cheese in most shops. If we could start processing milk, we will improve nutrition as people will buy milk products and incomes would increase with higher prices for the value addition to the milk,” says Cresco Kwezembe, a local councilor and chairperson of the group.

To help the group start their milk processing businesses, CLIM² has procured milk and yoghurt pasteurization and bottle packaging machines and sachet packaging machines for Bvumbwe Dairy Cooperative, Umodzi Milk Processors and Thunga Dairy Cooperative in Thyolo District.

“With these processing plants, farmers will have an alternate option to sell their milk, which will lead to better proceeds and livelihoods. With increased milk production, farmers are more likely to consume some of the milk themselves. Investing in local dairy processing companies not only creates local employment, it also contributes to make milk protein available to local consumers. Working through local Care Groups, and preferential procurement agreements with government offices, schools and hospitals are ways to promote local milk processing for improving nutrition locally,” explains Homann-Kee Tui.

Madalitso Namacha, one of the youth who started Umodzi group explains that in 2018 youth in the area began addressing some of the problems facing the residents. “We realized that our people are not being paid enough by milk buyers and decided that we needed to do something to help,” he explains adding, “We went to the district council who then linked us with CLIM² who committed to support us. We plan to use this group as an avenue of development in the area and beyond, going beyond milk production”.

Chairperson of the group, Cresco Kwezembe, explains that with the coming of the processing machines, the group plans to buy milk from multiple bulking groups in the area at higher prices, a thing that will improve livelihoods for communities.

Bvumbwe dairy cooperative is the oldest dairy cooperative in Malawi. It has been affected by operational and administrative challenges. “Our biggest challenge has been the quota that processors have been giving us. Whenever processors have more supply, they do give us supply limits. We end up throwing away milk from our farmers just because the processors cannot buy more”, says Laston Kampunga, chairperson of Bvumbwe Cooperative.

“Whenever milk is returned by the processors we have to throw it away. The coming of this equipment means that milk will not be thrown away, we will be processing it and selling it ourselves,” he adds.

In trying to enhance farmers’ productivity and reducing the cost of production the project trained them in utilizing crop residues, own production of feed and processing, and provided farmers groups with  hammer mill, to reduce feed losses and increase feed intake.

”We have seen that local processing and marketing is a good avenue for a cooperation of farmers to increase income, if the profits can be shared with farmers,” explains Claire Mwamadi, CLIM² Project Monitoring and Evaluation Officer.

Malawi now has four established milk processing companies; before 2016, one company monopolized the industry. It is hoped that with more local groups venturing into processing, farmers and processors will earn more through competitive selling prices and value addition proceeds.

Umodzi Dairy processor cooperative in Thyolo District. Sabine Homann-Kee Tui, ICRISAT

CLIM² has also procured a hammer mill for the cooperative to help them produce feed for cattle. “Nutrition for the cows has been another challenge; feed costs for cattle are very high. This mill will help us produce balanced diets for dairy cows so that we produce more milk. The project has also taught us how to use local crops and trees to make low cost but nutritious food for our cows,” Laston Kampunga explains.

As this story tells us, “local processing and marketing is a good avenue for a cooperation of farmers to increase income, if the profits can be shared with farmers. This will however require significant additional skills by the cooperatives and employees. At this level, the possible improvements are again, reducing the cost of production and losses of milk, and increasing value through processing”, Andre van Rooyen, ICRISAT.

Written by:
Horace Nyaka