Delivery of advisory and technical
services for dairy smallholder production
systems: the concept of dairy hubs
Jo CADILHON and Isabelle BALTENWECK
AU-IBAR meeting on the role of public and private sector in livestock services
delivery in Africa, 5 December 2012, Naivasha Sopa Lodge, Kenya

ILRI in brief
ILRI
 a member of the CGIAR Consortium which conducts food and
environmental research
 to help alleviate poverty and increase food security
 while protecting the natural resource base
India
Mali
 700 staff
 100 scientists and
researchers
 more than 30 scientific China
disciplines Vietnam
 Two large campuses
(Kenya, Ethiopia).
 2012 budget USD 60 mill. Laos
 ILRI works with a range of Nigeria
partners
Mozambique Sri
Lanka
Kenya
Ethiopia Thailand
 ILRI’s vision: A world made better for poor people in developing countries by 2
improving agricultural systems in which livestock are important.

Outline of presentation
1. Using hubs for pro-poor livestock value chains
development
2. The East Africa Dairy Development Project
 EADD background, vision and objectives
 EADD hubs model
 Assessment results: provision of extension services
by EADD hubs
3. Way forward for extension services by dairy
hubs
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Pro-poor livestock development and value chains
 ILRI fosters a demand-led development model
 Informal markets provide substantial opportunities and can
be made to function well
 Market access and utilisation can be improved by:
 Access to inputs
 Access to services
 Training and institutional capacity building
 Reduced transaction costs
 Better risk management
 Improved market access and utilisation improve the
livelihoods of the poor
 Involving multiple actors
 With benefits to women
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The role of hubs in pro-poor livestock development
 Collective action is a knee-jerk response by
development actors
 Hubs show promise:
 As an intervention
 As a means of intervening
 What are appropriate organizational and
institutional mechanisms in various contexts?
 Intensive versus extensive production systems
 Strong versus poor government support
 Dynamic versus low private sector involvement
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What do hubs do?
Hubs provide a critical mass of producers, products or
inputs use, thus attracting other market actors
 Hubs provide a contact point
 They reduce communication
costs
 They reduce transactions costs
 Hubs enable countervailing
market power
 They provide for network effects:
knowledge, technology and
innovation
 Hubs facilitate peer pressures 6
 Etc.

ILRI contributions to dairy hubs projects
 Design, implement and analyse baseline survey
 Support the design and implementation of a monitoring
and evaluation system for hubs
 Analyse results from monitoring system
 Collate and document lessons learned, including on
issues related to gender and youth
 Design, pilot test and monitor selected interventions
related to feed, animal production and marketing
 Support projects’ technical activities on extension,
breeding and improving milk quality, etc.
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EADD background
 A large proportion of the farming population in East
Africa consists of subsistence farmers with low market
orientation for both farm inputs and outputs
 Smallholders are limited by low levels of production,
product quality and market infrastructure:
 Low feed and fodder quality
 Post-harvest losses
 Lack of processing equipment
 ILRI partnered with Heifer International and other
organizations to pilot test a new dairy development
model in East Africa: the East Africa Dairy Development
Project was launched early 2008 with financial support
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from the Bill & Melinda Gates Foundation

EADD vision and objectives
Vision
 Transform the lives of 179,000 smallholder farming
families (approximately 1 million people) by doubling
their household dairy income in 10 years
Objectives
 Harness information for decisions and innovation
 Expand access to markets
 Increase productivity and
efficiencies of scale
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EADD1 pilot phase – Factsheet
 Scope
 Duration: Jan 2008-Jun 2012
 Budget: USD42.85m (BMGF)
 Investment fund: USD5.0m
 BMGF: USD2.5m
 Heifer: USD2.5m
 Partners
 BMGF
 HI – lead
 TNS – business development
 ILRI – knowledge-based learning
 ABS – genetics & breeding
 ICRAF – feeds & feeding
 Structure (>120 staff)
 Country offices
 Kenya
 Rwanda
 Uganda 10
 Regional office

EADD hubs
 At the heart of EADD is the hub approach which aimed to increase dairy
income of poor dairy farmers through various interventions along the value
chains so as to improve farm productivity and market access
 Dairy hubs serve as community anchors for industry knowledge sharing,
business services and market access
 The hub approach as implemented by EADD facilitates the emergence or
strengthening of a network of inputs and services providers and the set up
of a credit facility mechanism
 Progressively the hub becomes a platform used by other inputs and
services providers to reach smallholder farmers
 Possible add-ons include inputs for activities other than dairy, savings and
credit facilities, household expenses (food, medical and school expenses),
energy saving solutions (bio-gas and solar panels)
 When fully functioning, the dairy hub is a dynamic cluster of services and
activities that generate greater income for dairy farmers
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EADD hubs
FARMERS
OTHER RELATED
MEs
HARDWARE SUPPLIERS
CHILLING or BULKING
VILLAGE BANKS FACILITIES
FIELD DAYS
TESTING
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AI & FEED TRANSPORTERS
EXTENSION SUPPLY

EADD approach
1. Beneficiaries are selected based on need, opportunity and initiative
2. Farmers are mobilized into cooperatives, associations or producer
companies
3. Companies are assisted to set up infrastructure to market milk and
deliver inputs to members through the ‘Dairy Hub.’
4. EADD staff provide technical assistance to producer companies to
achieve farmer goals in a sustainable manner
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Some lessons learned from
the EADD hub approach
 Hubs should be seen as an approach, rather than a model, with
various ‘options’ to choose from, depending on farmers’ capacity,
state of the industry and external environment:
 Hubs centered around provision of inputs and services
 Hubs centered around bulking without cooler
 Hubs centered around chilling plants
 In some locations, the chilling plants were not successful to catalyse
farmers around the hub but other services provided were useful to
farmers
 Provision of inputs and services, including advisory services can be
done in-house, like in the case of a cooperative, or out-sourced
 For advisory services, it is important to embed services in the hub
for accountability and sustainability issues
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Assessment of extension services
provision by hubs
 Overall, 82 dairy farmer business association (DFBAs) were
supported in three countries and their progress monitored in early
2012
 EADD-supported sites were assessed on 5 dimensions:
 Feeding
 Breeding
 Animal health
 Milk quality
 Extension services structures
 Scores can vary between 0 (low level of development) and 100 (fully
developed sites which no longer require external assistance)
 Sites with scores above 60% are considered ‘mature’ and require
only minimal external support
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Sites of EADD hubs assessment exercise
Number of DFBAs staged List of DFBAs staged
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Actual development scores are distributed
from 7.5 to 62 (%)
Kenya Rwanda Uganda
70.00
65.00
Highest
60.00  62.0 (TANYIKINA, Kenya)
55.00
50.00
45.00
40.00
75% quartile
Score
 42.0 (GASI,Rwanda)
35.00
Median
30.00  34.8 (ZIGOTI, Uganda)
25.00
20.00 25% quartile
 27.3 (KIBOGA WEST, Uganda)
15.00
10.00
5.00 Lowest
 7.5 (NSAMBYA, Uganda)
0.00
- 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 55.0 60.0 65.0 70.0 75.0 80.0 85.0 90.0 95.0 100.0
Percentile
Source: 2012 Stage Gate Assessment Data, May 2012 17

Results for advisory services indicators
Most producers’ organizations in Kenya
have extension units, unlike in Uganda
and Rwanda where the organizations
are less mature and capacity is lower
Less than half the sites are able
or willing to spend own funds on
supporting extension, meaning
that other sources of funding
are required
Source: 2012 Stage Gate Assessment Data, May 2012 18

Results for advisory services indicators
• Most producers’ organizations in
Uganda and Rwanda found it difficult
to attract and retain qualified
managers
• Most organizations have linkages with
governments and other institutions
• Strategies to reach women partial in
the majority of sites; no strategies in
the rest of the sites 19
Source: 2012 Stage Gate Assessment Data, May 2012

Way forward: capacity building models
for hubs in EADD2
 Focus on provision of advisory and technical services
 Assess effectiveness, efficiency and sustainability of four main
extension approaches using hubs in various environments
 What approach works best to reach out to women, youth and poor
farmers?
 Bundled services by private extension agents
 Private extension agents contracted by hub
 Value chain partner provides extension to farmers
 Use public service extension services
 Assess whether the approach can be used in other livestock value
chains (pigs and small ruminants)
 Compare hubs with other capacity building models: cooperative,
private franchised system (SIDAI), etc.
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Thank you for your attention
Feedback welcome
Email: j.cadilhon@cgiar.org
i.baltenweck@cgiar.org
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