International Journal of Innovative Research and Development

Abstract

A study to characterize and document information on dairy farms and their profitability in central Kenya was carried out with the view to addressing concerns raised by stakeholders on the country’s inability to supply affordable milk at both the local and export market. Data were collected from 135 randomly selected farms in Central Kenya. The statistical package for social sciences (SPSS) was used for data analysis. Results revealed that farmers owned cattle of high milk production potential in terms of their genetics, but which produced low (9.2 kg) quantities daily. The reasons attributed to underperformance were; overstocking, underfeeding, poor housing and sub-optimal animal husbandry. The size of land owned could not supply enough roughages, and both the concentrates and mineral supplements were inadequate. Farms averaged about 2 acres on which mixed livestock-crop farming was practiced. They employed 2.2 hours per cow per day against the standard 1.6, a situation attributed to ownership and management of small land parcels in different places. Only 23.7% of the farms had chaff-cutters. Animals were uncomfortable in the feeding area resulting from poorly constructed zero-grazing units.  Extension service was inadequate.  Among the entire farmer characteristics assessed; age, education level, experience, group membership, and attendance to business related courses; none showed a significant relationship with milk yield. The average cost of milk production (Ksh. 37) was higher than its farm-gate price (Ksh. 25.5), a condition that was attributed to relatively high input prices and farm level resource utilization inefficiency. Only a few farms made any profits from dairy farming. It was recommended that a policy regarding minimization of household land sub-division be put in place. Additionally, there was a felt need for providing inducements that encourage agricultural enterprises specialization. Dairy farmers require improving on dairy and fodder crop husbandry, as well as farm level feed resource utilization efficiency. Policies targeting reductions in the cost of farm inputs were also recommended. Researchers require developing drought resistant fodders.

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The objective of this study was to determine the cost efficiency of dairy cow farms in the Eastern Central highlands of Kenya. The data was collected through a cross-sectional survey from 135 farms in the study region.  The sample size was determined using the Fischer’s formula. A stochastic frontier cost function was estimated using the maximum likelihood estimation technique. The MLE results revealed that the costs of roughages and labour were the major determinants of dairy farming cost. The farms operated at low economies of scale, mainly because the land size owned averaged only two acres; where mixed crop-livestock farming was practiced. It was revealed that roughages could substitute with either mineral supplements or labour to reduce farming costs. The mean farms cost efficiency index was 4.4% above the frontier cost. Most farms did not make profits. The average cost per farm was Ksh. 551 while the milk revenue was Ksh.365. It was concluded that farmer-cost inefficiency was not the main cause of the high milk production cost. The cost of feeds coupled with the relatively small land sizes owned and the cost of labour were the main challenges facing dairy farming in the study region. It was recommended that policy makers come up with necessary laws and regulations to ensure that the continued land sub-division is reversed and that the cost of dairy farming inputs is reduced. Researchers require establishing the least-cost combination ratio for roughage and labour.

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