Grantee: Heifer International
August 10, 2010
This grant made substantial progress on its milestones in 2009 as the project became fully operational. While challenges remain, the project continues to build momentum and is on target to meet its overall goals six months to a year later than planned.
Mobilizing farmers: In 2009, Heifer mobilized 47,445 dairy farmers into farmer groups so they can form business associations and establish chilling plants that will help them get their milk to market. While the project fell short of its goal of forming 35 business associations in 2009, the number of associations is growing rapidly.
Chilling plant financing: Due to the global financial crisis, staffing changes and the reluctance of banks to invest in agriculture projects, there were significant delays in meeting the goal of securing financing for 23 chilling plants. However, the project investment fund created to help farmers get financing has generated interest from governments and the commercial banking sector, including Fina Bank, K-REP Development Agency, and the Development Bank of Rwanda.
Thanks to the investment fund, Heifer was able to secure commercial financing for Kabiyet Dairy Company, Ltd. in 2009. By the end of 2009, Kabiyet had 2,802 members and was collecting 30,432 liters of milk per day, three times more than expected. Kabiyet is offering artificial insemination and other services to farmers and anticipates paying off its loans more quickly than expected, attracting more attention from banks for other chilling plants.
Breeding strategies: Artificial insemination, aimed at breeding cows that will produce a higher volume of milk, continues to prove challenging for producers living in more marginal environments. Heifer is re-evaluating its approach to breeding and exploring solutions to this problem.
Adapting to farmers' needs: The original project plan called for centralized bulk purchasing of the chilling plant equipment. This process proved slow and delivered equipment that many dairy farmer associations found too expensive. In 2009, Heifer decided to allow the associations to choose their own chilling plant equipment. Many farmers bought used or lower-cost equipment, resulting in a 30-40 percent reduction in capital cost, lower operational costs, and more satisfied farmers.
Private sector partners: The project is developing partnerships with dairy processors and other private sector players, which are critical to ensuring a market for chilled milk. Nestle and Tetra Pak, two major dairy business partners, have already stepped forward with donations of technical training and funding to help improve the project’s milk quality.
Learn more about this grant to Heifer.