Smallholder Dairy Commercialization Programme

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Smallholder Dairy Commercialization Programme (SDCP) Funded by IFAD, the Smallholder Dairy Commercialization Programme was implemented by Kenya's Ministry of Livestock Development from 2006-2012.[1] This is a $19.8 million program from 2006-2012. "It fosters market-driven development of the informal dairy industry. It will work with smallholder dairy producers and traders to strengthen their capacity to respond to market opportunities. The program will build their understanding of the market and their technical knowledge of production processes."[1] It covers Nakuru, Trans Nzoia, Uasin Gishu, Bomet, and Nandi North Districts in Rift Valley province; Bungoma, and Lugari Districts in Western Province; and Nyamira and Kisii Central Districts in Nyanza Province. The project aims to target "‘Resource-poor’ dairy farmers; ‘Part-time’ dairy farmers; Small-scale intensive dairy farmers; Crop-oriented farmers with dairy cows; Small-scale milk bars and shop operators; and Mobile milk traders."

The project identifies "Dairy Commercialization Areas (DCAs)" using the criteria of:

  • "1. Milk density thresholds of >90 000 litres/km2/year for ‘high density’ areas and 60,000 to 90,000 litres/km2/year for ‘medium density’ areas.
  • "2. Poverty threshold of at least 46%.
  • "3. For districts with similar milk density and poverty threshold, those with greater road density and geographically contiguous were selected, in order to ease logistical arrangements for programme management."[1]

As of 2008, SDCP had identified 27 DCAs in all the 9 districts... The DCAs cover only a small portion of the district sometimes only one location.[1]


"The Smallholder Dairy Commercialisation Programme was developed through a process of dialogue between the Government of Kenya and IFAD, originating with the approval of IFAD's first Country Strategic Opportunities Paper (COSOP) for the country in 2002. The Programme is implemented through a Market Oriented Dairy Enterprise (MODE) approach. This involves a gradual movement of programme beneficiaries from one level to the other to increasingly access more benefits from their milk and dairy products...
"The overall objective of the SDCP is to increase the income of the poor rural households that depend substantially on production and trade of dairy products for their livelihood.
"Programme Purposes
  • "1. Improving the financial returns of market-oriented production and trade activities by small operators, through improved information on market opportunities, increased productivity, cost reduction, value adding, and more reliable trade relations; and
  • "2. Enabling more rural households to create employment through, and benefit from, expanded opportunities for market-oriented dairy activities, in particular as a result of strengthened farmer organizations.
"Five components support the overall goal and purposes of the programme:
"The objective of the component is to provide for updating the capacity building of groups of smallholder dairy producers, small-scale processors and small milk traders.
  • "Output A.1) Improved group organisation to access benefits from marketing of milk and dairy products
  • "Output A.2) Effective application of the MODE approach and improved capacity of beneficiaries for business planning and enterprise development
  • "Output A.3) Improved access to financial services to the programme target groups
"The objective of the component is to support a range of measures to strengthen smallholder dairy producers’ access to relevant, up-to-date information and techniques.
  • "Output B.1) Enhanced Smallholder Dairy farming production skills
  • "Output B.2) Increased technical capacity on appropriate feed strategies (production, sources, conservation and utilization of fodder)
  • "Output B.3) Improved capacity of public and private sector providers to deliver good quality and cost-effective AI/breeding and other technical services
  • "Output B.4) Improved availability of viable technologies at low cost in the Programme area
"The objective of this component is to improve the milk marketing chain and smallholder dairy operators’ access to it.
  • "Output C.1) Sustainable LCMIS set up and operational and linked to Dairy Information Centre
  • "Output C.2) Information gathering and elaboration of a strategy for improvement of market access (e.g. rural infrastructures)
  • "Output C.3) Improved capacity of dairy groups to marketing their products
  • "Output C.4) School Milk Programme tested and ready for up-scaling
  • "Output C.5) Goat milk production and marketing
"The objective is to support policy and legislative development for the animal feeds sub-sector, development of a strategy for commercialisation/privatisation of Central Artificial Insemination Station (CAIS), harmonization of breed services including recording and AI services and a stakeholder validation process.
  • "Output D.1) Conducive policy and legal environment for the development of the smallholder dairy sub-sector created*
  • "Output D.2) Key institutions relevant to the dairy sector strengthened (Dairy Training Institute, KDB and Central Artificial Insemination Station CAISI)
  • "Output D.3) Capacity of DTI to carry out research, training and dissemination of dairy technologies improved
"The overall guidance and direction is provided through the Programme Coordination Unit (PCU) based in Nakuru.
  • "Output E.1) Project management is effective and beneficiaries are fully involved in the implementation and monitoring of the project activities"[2]

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