Quarterly Progress Report: Kenya Dairy Sector Competitiveness Program

with the financial and technical support of the United States Agency for International Development (USAID). The program aims to improve Kenya's dairy industry competitiveness by transforming the industry into a globally competitive, regional market leader. The overall goal of the program is to increase smallholder household income from the sale of quality milk. The program objectives are three-fold: to increase the competitiveness of the Kenyan dairy sector through collaboration among sector stakeholders and increased capacity of public sector agencies to serve the needs of the sector; to increase marketing of milk meeting quality standards by producer-owned milk bulking/cooling businesses; and to enhance access to market-linked business development services and technologies by male and female dairy farmers and processors producing dairy-related inputs. KDSCP contributes to the USAID Strategic Objective 7.0 on "Increased Rural Household Incomes." The program is implemented through a range of activities grouped into three broad components. Component 1, Enhanced Capacity for Milk and Production Input Quality Certification and Market Promotion, aims to increase smallholder household income, increase the use of technology, improve and enact industry policies and acts that enhance competitiveness, and develop and implement/enforce quality certification frameworks. Component 2, Dairy Smallholder Business Organization (SBO) Development, focuses on strengthening producer organizations, increasing the number of Milk Bulking Centers (MBCs) with Hazard Analysis and Critical Control Points (HACCP) and/or SBOs with national certifications, increasing raw milk sales by SBOs under agreements that pay premium for quality, and increasing the gross revenue of milk bulking/cooling businesses from the sale of inputs and services other than milk. During the reporting period of October to December 2012, the program facilitated the registration of 1897 animals with the Kenya Stud Book, conducted recognition meetings in 7 milksheds, and facilitated capacity building of 5027 dairy farmers in the quarter. The program also recruited and trained 18 new business service providers, bringing the total number of service providers working with the program to 1042. Additionally, the program continued implementing action plans developed by stakeholders to build the capacity of SBOs and increase farm-level productivity, with 135 farmer organizations having had their capacities built compared to the program target of 120 groups. Farmers also continued to enjoy financial services from financial service providers, with K-LIFT (Kenya Livestock Finance Trust) introducing financial services to SBOs. By the end of December 2012, K-LIFT had advanced loan facilities to about 32 farmers from the different SBOs working with the program, with a loan amount disbursed of KES 4.2 million (USD 53,500).