Dairy Value Chain Analysis in Bench Sheko and Sheka Zones, South Western Ethiopia

Abstract

Background and Objective: Dairy production is low with very fragmented and uncoordinated value chain in Bench Sheko and Sheka zones despite of well suited agro-ecology and vegetation cover for the production. Thus, this study was intended to characterize dairy value chains and value addition practices with its determinants. Materials and Methods: A multi-stage random sampling technique was implemented to select 160 sampled households. Descriptive statistics and probit model were used to analyze the collected data. Results: Five and three main alternative marketing channels were identified for butter and cheese marketing, respectively. From the channels, dairy producing farmers’ gross profit was highest when they directly sale butter and cheese in channel II and I, respectively. Among the sampled households, about 72% participated in dairy value addition practice. Probit model regression result shows that number of children below 6 years, type of dairy breed, number of dairy cows currently owned, distance from urban centers, milk yield per day, market information and extension services are the significant factors affecting participation in dairy value addition. Conclusion: Overall, the value addition practices were low as compared to the potential available for dairy production. Therefore, providing training on proper management and way of adding value on their product, demonstrations of improved livestock breed and organizing dairy marketing cooperative should be considered by concerned bodies