Upgrading the smallholder dairy value chain: a system dynamics ex-ante impact assessment in Tanzania's Kilosa district

Abstract

This paper examines ex-ante impacts of two policy interventions that improve productivity of local-breed cows through artificial insemination (AI) and producers’ access to distant markets through a dairy market hub. The majority of cattle in Kilosa district in Tanzania are local low productivity breeds kept by smallholders and agro-pastoralists. Milk production is seasonal, which constrains producers’ access to distant urban markets, constrains producers’ incomes and restricts profitability in dairy processing. We developed and evaluated an integrated system dynamics (SD) simulation model that captures many relevant feedbacks between the biological dynamics of dairy cattle production, the economics of milk market access, and the impacts of rainfall as an environmental factor. Our analysis indicated that in the short (1 year) and medium (5-year) term, policy interventions have a negative effect on producers’ income due to high AI costs. However, in the long term (5+ years), producers’ income from dairy cattle activities markedly increases (by, on average, 7% per year). The results show the potential for upgrading the smallholder dairy value chain in Kilosa, but achievement of this result may require financial support to producers in the initial stages (first 5 years) of the interventions, particularly to offset AI costs, as well as additional consideration of post-farm value chain costs. Furthermore, institutional aspects of dairy market hub have substantial effects on trade-offs amongst performance measures (e.g. higher profit vs. milk consumption at producer's household) with gain in cumulative profit coming at the expense of a proportional and substantial reduction in home milk consumption.

Exploring the best policy scenario plan for the dairy supply chain: a DEMATEL approach

“…Research about the important drivers or indicators or factors and the measurement tool for assessing the performance of the dairy supply chain can be found in Prakash and Pant (2013), Kumar (2014), Kumar and Mohan (2014), Okano et al (2014), Mor et al (2017, 2018), Susanty et al (2018), Susanty et al (2019), Dizyee et al (2019) and Bórawski et al (2020).…”

“…Then, using ISM methodology, Mor et al (2018) identified PIs that make the most contribution to the Indian dairy industry sector, namely, the information-technology-enabled support system, brand management and featured products, responsiveness in shipment accuracy and milk wastage management. Susanty et al (2019) and Dizyee et al (2019) used system dynamic methodology to simulate the causal relationship between several factors that contributed to the performance of the dairy supply chain in Indonesia and Kilosa, a district in Tanzania, respectively. In this case, Susanty et al (2019) proposed five policy scenarios, i.e.…”

“…In this case, Susanty et al (2019) proposed five policy scenarios, i.e. dairy cattle import, operational assistance for dairy cooperatives, dairy farmer training, operational assistance and dairy farmer training and the combined scenario, whereas Dizyee et al (2019) proposed two scenarios, namely, artificial insemination (AI) and producers’ access to distant markets through a dairy market hub. Susanty et al (2019) found the combined scenario to be the best among the five proposed scenarios.…”

MILK Symposium review: Sustainability of dairy production and consumption in low-income countries with emphasis on productivity and environmental impact

“…According to FAO (2011a), "one of the major constraints for intensification of small-scale livestock production is the lack of good quality feed resources." Dairy animals in low-income countries often suffer from malnutrition in several months throughout the year as a result of climatic, economic, and management conditions (Val-Arreola et al, 2004;Dizyee et al, 2019). Animal health and milk production cannot be sustained if dairy cows are underfed and undernourished.…”

Using “theory of change” to improve agricultural research: recent experience from Tanzania

“…However, gender awareness and integration in local government activities at the village level was still low, though partially mitigated by gender awareness training and deliberate inclusion as group leaders by MZ. These inadequacies require additional public investments for a longer period before private capital can yield positive returns (Dizyee, Baker, and Omore 2017;Kilelu et al 2017).…”