Economic study of the milk value chain through the Kiganda-Bujumbura Mairie circuit in Burundi

Abstract

The value chain (VC) analysis of commodity chains is a strategic tool made for measuring, developing and maintaining sustainable a commodity. This paper analyzes the economic dimension of the milk VC through the Kiganda-Bujumbura Mairie circuit in Burundi. Using primary data, a distribution of profit margins between actors was assessed. This survey involved a sample of 67 actors. The sampling technique used was the "snowball" method due to the lack of a sampling frame of actors. Secondary data were also collected in order to complete the primary data. The analysis was carried out using general and quantitative tools compatible with the subject matter. The results show that retailers benefit an average monthly profit margin of 201 Burundian franc (BIF) [US$0.097] per liter with an average monthly turnover of 1,818,733BIF [US$879.48]. Dairy farmers have a monthly profit margin of 187BIF [US$0.090] per liter. Their average monthly turnover is 134,894BIF [US$65.23]. The collectors have a profit margin of 78BIF [US$0.037] per liter with an average monthly turnover of 1,815,000BIF [US$877.67] and the wholesalers have a profit margin of 47BIF [US$0.022] per liter with an average monthly turnover of 7,257,480BIF [US$3,509.52]. Low margins are mainly due to the small quantities of milk produced and high production costs. Dairy farmers breed local breeds, with the constraints of balanced feed. The problem of suitable transport and processing equipment also affects the quality of the milk. Small dairy farm would benefit from forming associations and/or cooperatives. Being in associations and/or in cooperatives, they should be able to breed the improved breed, benefit from other advantages such as training, easy access to veterinary services, agricultural financing credits, etc. Public authorities must at all times monitor compliance with standards governing the dairy sector, and introduce regulatory measures if necessary.