Tanzania Dairy Productivity Challenge Project

The AgResults Tanzania Dairy Productivity Challenge Project was a four-year, US$4.9 million prize competition that aimed to increase dairy productivity by encouraging private sector input suppliers to deliver inputs to smallholder farmers. By providing a prize for each bundle of high-quality inputs delivered, the competitions increased animal productivity, boosted smallholder farmers’ incomes, and strengthened value chain relationships between dairy producers and the formal dairy sector. Land O’Lakes Venture37 served as the Project Manager.

Tanzania Dairy Project Timeline

THE LEARNING JOURNEY

The Tanzanian dairy sector, which is dominated by smallholder farmers, struggles for a variety of reasons: approximately 97% of Tanzania’s dairy cattle are low-yield breeds, poor management practices are prevalent, and there are seasonal fluctuations in the availability of forage and feed. This precludes many smallholder farmers from accessing affordable extension or veterinary services. The lack of high-quality inputs, such as parasite control, nutritious feed, vaccines, and artificial insemination (AI), is at the heart of the problem.

CONTEST DESIGN

Theory of Change

The project was designed to incentivize private sector input suppliers to package and deliver input bundles comprising a combination of parasite controls, high quality feed or fodder, vaccines, and/or artificial insemination inputs to smallholder dairy farmers. By encouraging suppliers to provide input bundles and advisory services to smallholder farmers, the project addressed a variety of current weaknesses in Tanzania’s dairy value chain. As farmers gained access to these materials and received regular training, their knowledge of livestock management improved as did their use of vaccines and health inputs, in turn boosting the nutrition of cows. Healthier and more productive cows improved the quality of the milk, positioning smallholder farmers to participate more fully in formal markets. Accessing these markets drove up smallholder farmers’ incomes and cemented their relationships with key value chain actors.

Prize Structure

Increasing Prize Amount for Complex Bundles

Prize bonuses were applied when competitors bundle one or more inputs. These bonuses aimed to incentivize the development of partnerships between companies and help competitors more affordably offer inputs to farmers. These more complex bundles were expected to generate higher productivity gains for farmers.

Input Categories

Competitors had to sell the following inputs directly to smallholder farmers to qualify for a prize:

• Artificial Insemination (AI): Conventional or sexed semen and minerals
• Vaccines: Vaccines for commonly occurring cattle diseases, adjusted each year
• Parasite control: A combination of Acaricides and Anthelminthic as a single input package
• Nutrition: Approved nutrition packages that may include hay, fodder, minerals, vitamins, urea molasses blocks, use of individual fodder plots, and standard dairy meal

EXPECTED IMPACT

The project was expected to engage private sector dairy input suppliers in Tanzania to deliver a variety of input bundles to smallholder farmers to increase milk production quantity and quality. By pairing these input bundles with required extension services, input providers would develop relationships with farmers and build sustainable networks to strengthen the entire value chain. Because bundles with multiple inputs will earn higher monetary prices, some suppliers would also create coalitions to package and deliver these complex bundles. As farmers continued to incorporate best practices and high-quality inputs, animal productivity would improve, and farmers would create links with commercial milk processors and reach formal markets. At the same time, rural households would have regular access to more nutritious milk for home consumption.

AgResults expected to achieve the following by the end of the project:

• Approximately 23M liters of additional milk production
• $9.4 million in additional farmer revenue
• $4.14 million in competitor revenue
• 22% market penetration in the number of dairy farmers in the target region(s) reached

ACTUAL RESULTS

EVALUATION