The dairy production market system in the pastoral and agro-pastoral areas of Ethiopia remains predominantly subsistence-based with limited market-orientation and poor institutional support. Producing for the market requires re-orientation of the production system and development of knowledge-based and responsive institutional support services. Investment in the value adding parts of the dairy chain has been identified as one of the key interventions to transform subsistence dairy production into market orientated one. The recently established Berwako Milk Processing PLC,in Jijiga, the capital of Ethiopian Somali Regional State, has an important role toplay in catalyzing a market-oriented dairy development. The USAID-funded PRIME (Pastoralist Areas Resilience Improvement through Market Expansion) project has been providing technical and financial support to this enterprise which was established a local entrepreneur Mr. Amir Mukhtar. Working with two milk consolidation cooperatives in Danusha and Bombas, a relationship that was facilitated by USAID-PRIME, Berwako currently collects cow and camel milk from around 300 households to turn row milk into different milk products of longer shelf-life. The company has started marketing its productsin Jijiga and other urban areas of the country like Addis Ababa, and neighboring countries, including Hargessa in Somalia.[read more=”Continue Reading..” less=”Less”]
The collaboration of producers, Berwako PLC and USAID-PRIME in support of the market system development, has so far resulted in stabilized production, more stable and efficient collection of milk, and an efficient distributionof finished products. Less than five months into its start-up, the daily processing capacity of Berwako for December 2014 has reached 1,200 liters of milk per day- still on an increase at a promising rate. Moreover, the higher price Berwako PLC offers for quality milk has resulted in improved quality raw milk and increased income for the milk producing households.
The owner of the firm, Amir Mukhtar, is optimistic about the prospects of the company. He says, “While the completion of this project poses numerous challenges, the vision of working together with the milk producing communities and the support we are getting from USAID keeps us confident that what we are doing will bring tremendous benefits to the households-who we create markets for, the consumers, and the national economy.”
With 25 full time staff on board, the company is set to process 5,000 liters of milk per day by June 2015. It is anticipated that USAID’s support to Berwako will enable more than 3,000 pastoral and agro pastoral households in Duhusha, Fafan, Bombas, Babile, Awbare and Kebribayah to have access to a more reliable, fairer, and regular market for their milk, resulting in increased household income. A better access to markets will in turn stimulate more production of milk, improving livestock productivity and quality.The Pastoralist Areas Resilience Improvement through Market Expansion (PRIME) project is a five-year (2013-2017), $56.7 million USAID-funded Feed the Future initiative designed to improve resilience of communities and market systems in Ethiopia’s dry-lands to enhance prospects for long-term development where pastoralist livelihood systems prevail. The project cost-share investments and provide technical assistance in partnership with financial service providers operating in Ethiopia’s Afar, Somali, and Oromiya regions. By buying down some of the investment risks inherent in these environments, the project aims to stimulate the market and build resilient business eco-systems. [/read]