Prof.E.Gicheru,Migwi Wanjohi, Silas Maiyo, ESTABLISHING THE RELATIONSHIPS AMONG DAIRY CO-OPERATIVES, SACCOS AND INDIVIDUAL DAIRY FARMERS: THE CASE STUDY OF THE MOUNT KENYA REGION IN KENYA A Research by: Prof.E.Gicheru,Migwi Wanjohi, Silas Maiyo, Kizito Omollo, Richard Mwangeka & Edith Kagumba From Agri and Co-operative Training and Consultancy Services Ltd and Co-operative University of Kenya Presented during Cooperative Research Symposium in Rwanda on 22nd May,2018

1.0 INTRODUCTION MT.KENYA REGION: Source: Wikimedia Commons

Cont’d INTRODUCTION Agricultural Co-operatives and Savings and Credit Cooperatives (SACCOs) – are 84% of all Co-operatives in the Kenya (Land O’Lakes,2018). Co-operatives, world over have lifted communities from the “jaws” of poverty. Agricultural Co-operatives and Savings and Credit Cooperatives (SACCOs) - represent approximately eighty four percent (84%) of all Co-operatives in the Kenya (Land O’Lakes,2018). Each of the two types of Co-operatives provides different, yet complementary forms of services and benefits to member farmers. Among serious Agricultural Co-operatives, are the Dairy Co-operatives!

Cont’d INTRODUCTION Dairy Value Chain in Kenya Total milk production was 3.5 billion(2007) ,5 Billions (2011) and 3.7Billion(2012) Litres 55% of all milk is marketed 20% goes through the formal channels. Dairy Co-operatives provide the main market outlet Dairy Industry has been growing Total milk production was 3.5 -5 Billion litres in 2017 55% of all milk produced in the Kenya is marketed, but only 20% of that marketed milk goes through the formal channels.

Cont’d INTRODUCTION SACCOs Ensure financial inclusion to both Dairy Co-operatives and Individual Dairy Farmers

2.0 STATEMENT OF THE PROBLEM limited financing, inadequate support of the Co-operatives by the Members; unstable milk prices and production; poor marketing, storage and transportation services; poor quality milk production ; non-formal milk buyers.

3.0 OBJECTIVES OF THE STUDY To establish the relationships among the Dairy Co-operatives, SACCOs and Individual Dairy farmers To establish the extent of financial inclusion of the Dairy Co-operatives and Individual Dairy Farmers

4.0 LITERATURE REVIEW 1.Co-operatives More than 24,000 Co-operatives Contributes 45% to the GDP of Kenya 80% of the Kenyans derive their livelihood 35% of the GDP-Agricultural-based co-operatives More than 1.5 million are dairy farmers. 2. SACCOs’ Contribution 3.Sustainable Development Goals (SDG) from the Co-operatives Development Perspective 4.The Relationship between Agricultural Dairy Co-operatives, SACCOs and Individual Dairy Farmers

5.0 RESEARCH METHODOLOGY Research Design-mixed approach Sample and Sampling Procedure- Purposive and Convenient sampling used Sample :Counties, SACCOs, Dairy Cooperatives, Chairs, CEOs/ Managers, Co-operative officers, Individual Dairy Farmers ,Actors(Veterinary Service providers ,Input suppliers ,Milk -Middlemen and Transporters Period of the study -19th March to June 2018 Data Collection and Instruments- questionnaires, interview schedules and FCD guidelines Data analysis for the Study -Quantitative Analysis and Qualitative Analysis Validation workshop-30 May,2018 Cooperative Financial Symposium-29June,2018

6.0 KEY FINDINGS SACCO 14 Approx 840,554 Active-85% Dormant-15% F-42% Number Membership Gender Relationships SACCO 14 Approx 840,554 Active-85% Dormant-15% F-42% M-58% 1.Give loans–Milk Advance, Inputs and Development loans to individual farmers and Dairy Coops 2. Offer Saving Products 3.Trainings 4. Give Milk payments Dairy Coop-eratives 26,776 Active-53% Dormant-47% F-45% M-55% 1.Access loans(86%)–Milk Advance(64%), Inputs and Development loans from the SACCO 2.Savings(93%) with SACCOs 4.Give Milk advance to farmers 5.Guarantee loans to farmers 6.Keeping of records

Cont’d 6.0 KEY FINDINGS Individual Dairy Farmers 47 - F-45% M-55% Number Membership Gender Relationships Individual Dairy Farmers 47 - F-45% M-55% 1.Access loans –Milk Advance, Inputs and Development from SACCOs & Dairy Co-operatives 2.Saves with SACCOs 3.Trainings 5.Loans Guaranteed loans Dairy Coops 6.Dairy Coops Keep of records

Cont’d 6.0 KEY FINDINGS

Cont’d 6.0 KEY FINDINGS .

7.0 RECOMMENDATIONS There is need to deepen the relationships among Dairy Co-operatives, SACCOs, Individual Dairy Farmers and other Actors in the Dairy Value Chain for mutual benefits i.e SACCOS to develop Financial Products for Milk Value Addition SACCOs to develop Financial Products to enable Animal Feeds production by the Dairy Coops SACCOs to offer long term loans to Dairy Coops and Individual Dairy Farmers

Cont’d 7.0 RECOMMENDATIONS Dairy Industry Act Cap 336 should be enforced to regulate the Industry Improvement of Dairy equipment and machinery e.g. coolants, pasteurizers Improvement of animal breed Enhance capacity building on financial literacy and good dairy farming practices to the Dairy farmers Enhance capacity building on governance to the Management Committee of Dairy Co-operatives

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