Today, the Kaduna State Government signed an MoU with global dairy giant Arla to transform the livestock sector in the state. Both sides will work on a project that will change livestock production from a culture into a business. This business model will create jobs, promote economic development and help resolve what has become a security problem.
In a new public-private partnership, Kaduna State Government and farmer-owned Arla Foods are committing to further development of a long-term sustainable dairy industry and local dairy sector in Nigeria by helping 1,000 small scale farmers create better livelihoods.
Already active in existing development projects within the dairy industry, Kaduna State, Arla and the Federal Government are now engaging further by signing a new Memorandum of Understanding. While the State and the Government will offer 1,000 nomadic dairy farmers permanent farm lands with access to water, Arla will be the commercial partner that will purchase, collect, process and bring the local milk to market.
Nigeria’s population – set to reach close to 400 million people by 2050 – is among the fastest-growing of any nation in the world, and already there is a growing consumer demand for affordable nutrition in the country. The new public-private partnership entered is the first of its size in Nigeria and is an important step in developing the local dairy sector.
Kaduna State Governor Nasir El-Rufai welcomes the project with Arla as a different and sustainable vision for the development of the livestock industry in Nigeria: “We are very pleased to collaborate with Arla Foods to grow and further improve our nation’s dairy industry. With our different competencies, together we can empower local farmers and promote a market-driven sustainable dairy development in Nigeria”.
Public and private investments pave the way
Kaduna State and the Federal Government are committed to improving the structural conditions for the nomadic farmers. Instead of continuously moving in search of grazing areas and water, land will be set up for the farmers to permanently base themselves and have opportunities to expand their farms. Securing the infrastructure such as roads, power and water, which are necessary to process and bring the milk to market, is also part of the public commitment.
The project will primarily be funded by loans provided by the Central Bank of Nigeria and guaranteed by the local state. As the commercial partner, Arla will invest in establishing milk collection centres. These will be pivotal to Arla’s role as a processor of the milk produced by the farmers.
Scaling up a successful approach
This new public-private partnership builds on the success of a collaboration initiated in 2016 with Kaduna State, the federal Government, Arla and a number of NGOs including Care, the Danish Agricultural and Food Council, the local dairy cooperative MILCOPAL and the Nigerian pastoralist organisation Coret.
That collaboration works on a five-year project called the Milky Way Partnership to develop a socially, environmentally and economically sustainable dairy value chain. The partnership and project have demonstrated a viable scalable business model that has created both an increase in income and job opportunities for local farmers and employees in the dairy sector.
At the Amana Dairy Cooperative in the outskirts of Kaduna, the farmers see the benefits of being part of the Milky Way Partnership. They now have steady access to water and a milking parlour has been installed to ensure that the milk is cooled down immediately after milking to preserve quality.
“Previously, the cows were drinking from the ponds. Now, they have fresh water and are well-fed. You can tell from their skin that they look healthy. We are very happy, and we are already starting to see the results as the milk quantity has almost doubled,” says Alhaji Sani Aliyu, one of the dairy farmers at Amana Dairy Cooperative.
“Developing Nigeria’s agriculture sector will be an important pillar for the country’s growth and the private-public partnership is a strong model to drive this. The ongoing collaboration between Arla and Kaduna State Government is a great example of the positive impact EU companies can bring when they engage with local producers and contribute to the federal and state government goal of creating 100 million new jobs of the next 10 years. This project has great potential to develop the local dairy sector and make a real difference in many farmers’ businesses and lives” says Jesper Kamp, Danish Ambassador to Nigeria.
Being built to last
The Nigerian dairy industry is currently able to supply less than 10 per cent of the country’s current demand for dairy products, a gap that is increasing exponentially as the population grows over the next decades.
Most Nigerian dairy farmers are small scale and most milk collection consists of milking the cows by hand into small open bowls or buckets. If the milk is not consumed in the farmer’s own household, it usually doesn’t travel farther than to the nearest town market. Preventing the milk from spoiling in the heat is a big challenge.
Arla will contribute with experience from its pan-European supply chain and its cooperative farmer culture to deliver commercial success with the farmers in Nigeria.
“Bringing local milk into our product portfolio is part of the way we believe that our business will be long-term successful in Nigeria. We will only succeed in growing local farmers’ incomes, building Nigeria’s dairy sector and achieving Arla’s ambitions in West Africa if the project and its activities are commercially viable. This is a great example of business and development going hand in hand to ensure long-term sustainable solutions that are built to last,” says Steen Hadsbjerg, Vice President Sub-Saharan Africa Region for Arla Foods.