Case study:

Value chain development: linking local smallholders to the dairy industry in Senegal

Cows graze in Senegal, small dairy farmers

The challenge

According to the World Food Programme (WFP) 46.7% of people in Senegal live in poverty and 17% are affected by food insecurity. Around 25% of children suffer from stunted growth. Despite Senegal’s semi-desert climate, there is a potential to increase locally produced raw milk and to process, pack and distribute it safely. Local dairy development is playing an important role to improve food security, education and nutrition, but technology transfer and technical assistance is needed.

However, creating a local sustainable value chain for fresh milk has its challenges. The average milk production yield is one of the lowest in the world with 0.6 litres per cow per day. It rains only three months a year. The knowledge of farming best practices is generally low. According to the International Farm Comparison Network, Senegal is only 66% self-sufficient in milk production, while 91% of locally produced milk is not processed industrially. In this environment, the cost to collect and process milk locally creates a challenge to compete with imported milk.

The initiative

Tetra Pak West Africa, Tetra Laval Food for Development, the local customer dairy processor SIAGRO and International Finance Corporation (IFC) have joined forces and are working with local smallholder dairy farmers to scale up milk production and collection.

SIAGRO processes large amounts of milk on a daily basis, of which only 12% is locally sourced. The objective of the partnership is to increase milk collection and have 20% of the total milk intake sourced locally. The solution is the establishment of a Dairy Hub, linking local farmers to a formal dairy value chain. Thus, smallholder farmers can sell the milk they produce and get access to the knowledge and training they need to develop their production. Milk collection infrastructure has been set up in the Fatick region by SIAGRO, with plans to continue expanding.

Tetra Laval Food for Development supported SIAGRO in the development of the Dairy Hub and Food for Development’s Dairy Development Specialist provided training to SIAGRO’s staff and farmers. Reference farms are being developed and the milk production and farmer income are being measured. IFC provided loans to SIAGRO for investments in dairy processing equipment.

Together with Tetra Laval Food for Development, IFC is also providing technical assistance to both farmers and the customers’ staff, the extension officers, for the development of local milk production. Subjects covered in the training include feed and nutrition management, reproduction and farm administration.

Due to the Covid-19 pandemic and travel restrictions, milk collection and on-site training have been a challenge. In order to address these issues, an online training programme has been developed by Tetra Laval Food for Development to keep supporting the Extension Service Officers with knowledge transfer. The online training programme consists of monthly webinars prepared and delivered by dairy development experts. SIAGRO is working with the farmers to continue milk collection amidst the mobility challenges caused by the Covid-19 pandemic.

The value

After 16 months, milk collection had increased 246% from a baseline of 12,900 litres to 44,670 litres. On the reference farms, monthly income has increased 109% from a baseline of US$120.90 to US$253.20.

Looking ahead

The model for a sustainable local dairy value chain development is in place and two farmer cooperatives have been established in two villages. The plan is for the farmer cooperatives to take full control and ownership over the milk collection centres and incorporate more local farmers into the Dairy Hub. New milk collection points have been created in the outlying villages where farmers previously had no local market for their milk.