Perspectives on Livestock Producer Groups:
Thanks for comments from:
Arne Gressmann: Chairperson, Meatco, Nambia
Massimo Castiello, Livestock Project Coordinator, Somalia, FAO
Joyce Turk, Senior Livestock Advisor, USAID,
Veronique Alary, CIRAD
Fernando Sampaio, ABIEC, Brazil
Micahel Zerr, Economist, Cargill
Jorge L. Rijis Nunez, SOL-AGRO, Paraguay
Victor Ahumada, Universidad Vina del Mar, Chile
Jerry Moye/Craig Irvine, Cobb
William Westman, American Meat Institute,
Paul Strydom, Meat Board of Namibia
Irene Hoffmann, FAO
Bert Rayner, Oztralia Marketing International, Australia
Evelyn Mathias, League for Patoral Peoples and Endogenou Livestock Development
Dugasa Dirbaba, working on Ethiopian Sanitary and Phytosanitary Standards Livestock and Meat
Marketing Program (SPS-LMM))
Ugo PicaCiamarra, Livestock Economist, AGA/FAO
Antonio Rota, Senior Technical Adviser, Livestock and Farming Systems, IFAD
Brian Bedard, Senior Livestock Specialist, World Bank
Cees deHaan, Senior Livestock Specialist, World Bank
Anni McLeod, Senior Livestock Policy Officer, AGA/FAO
Adriano Timossi, Geneva
Hamid Ahmad, Pakistan
Vincent Porphyre, CIRAD
Dil Peeling, FAO/IGAD Livestock Policy Initative
Beatriz Cavallotti. V
Muhammad Afzal, PARC, Pakistan
Carmen Jaquez, Land O’Lakes
James Kerr, ACIAR, Australia
Chris Hawkins, ACIAR, Australia
Jim Yazman, USAID,
Dr. Raghavan, Malyasia
Dr. Langelihle Simela, Zambia
Michael, Wondu Business & Technology Services, Australia
Some summary observations:
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Some successes, lots of failures. Projects in Kenya are cited as successful.
Success more likely if consumer driven (not just producer focused).
In pastoral systems, perhaps some types of grazing fees would move pastoralists into a more
commercial orientation (interesting but controversial).
Perhaps a credit orientation to the group structure would foster more cohesion and ensure
sustainability.
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Producer associations more functional if there is an umbrella organization (mentoring process):
example from Namibia/BRAC in Bangladesh.
1.
Arne Gressmann: chairperson of Meatco, our national abattoir company. Meatco manages
two abattoirs in the NCA (Northern Communal Areas) where the communal farmers have about
1.2 million cattle. The official off-take however (slaughtered at Meatco's abattoir's) is below 20
00 a year. Quite a
number of cattle are slaughtered for the local informal market, but even those "butchers" buy
animals at auctions in the commercial farming areas, because they don't get enough animals to
buy in the NCA region.
Certain Government Officials and Politicians accuse Meatco of not doing enough and pay good enough
prices to stimulate off-take in that region. To my mind that region should be able to market 250 000 300 000 slaughter cattle a year, generating an income of ± N$850million - N$1.02 billion for that region a region where the people are regarded as poor. It just doesn't happen.
To my mind as long as there is no cost involved in keeping and raising cattle / animals there is no ressure
on the owners to sell animals. Government should to my mind introduce a grazing fee to "force" people
to use their animals for commercial purposes, and not only as a status symbol.
We are quite frustrated, especially because Government holds us (Meatco) responsible for the low offtake.
2. Joyce M. Turk, Senior Livestock Advisor, Office of Agriculture, USAID, Washington, DC, 20523
Two examples from the Global Livestock Collaborative Research Support Program (GL-CRSP):
Southern Ethiopia-Northern Kenya – the Pastoral Risk Management (PARIMA) project led by Dr. Layne
Coppock, Utah State University, established over 59 collective-action groups that accumulated cash
savings of approximately US$93,000 from an initial base of zero. Of the 2,300 founding group members,
76% were women. The project estimates monthly implementation costs were $1 per person. 13,800
pastoralists were directly impacted by the CRSP’s action research in southern Ethiopia. Here is a link to
the short video describing it. http://www.vimeo.com/12800413
Ghana – the Enhancing Children’s Nutrition Management (ENAM) project) -- Malnutrition does not
make headlines the way famine does. But it is far more widespread and deadly. Globally, it affects more
than a billion people. It is the cause of more than one third of childhood deaths. By combining
microfinance with education about child nutrition, the ENAM Project has given Ghanaian women the
means and knowledge to fight malnutrition. This is the story of the ENAM Project and some of those
women.
http://www.vimeo.com/14063199
Research initially established six Women’s Credit Savings Associations in six communities reaching a
total of 184 women through the distribution of $12m000 after four loan cycles. Within two years, as a
result of partnering with an NGO and local rural banks, 96 Savings Associations were established in 32
communities reaching 2,257 women through he distribution of $900,000 and resulting in women’s
savings of approximately $57,000 from an initial base of $0. Since the conclusion of the project in March
2010, the rural banks have implemented Savings Associations across the country and have adopted the
project’s microfinance model including the education component.
3. Massimo Castiello, Livestock Project Coordinator
Emergency Operations Service, TCEO
Emergency Operations and Rehabilitation Division, TCE
Food and Agriculture Organization of the United Nations
FAO - Somalia
FAO Somalia has supported the formation of meat exporters Association from Somalia temporary based
in the UAE which has continued working after the end of a project aimed at the support o the meat
sector export in the Country. I do not know if the example suits the purpose but we can avail more info
4. Véronique Alary, CIRAD
Perhaps the experience of the association AREN in Niger on the animal trade with Nigeria.
But I know that this association receives the support of Oxfam. I join you a brief description of AREN
5. Fernando Sampaio, Sustainability Coordinator, ABIEC, Brazil
We have some group examples in Brazil that are working pretty well.
One is the Organic Beef Association in the Brazilian Pantanal: http://abpopantanalorganico.com.br/
The Pantanal has a history of 270 years of cattle raising, and its still the most preserved biome in Brazil,
with 87% of its original forest coverage.
The other is de Novilho Precoce (Young Steers Association) in Mato Grosso do Sul:
http://www.novilhoms.com.br/
Here, all breeders have a special training in good practices and animal welfare.
Some supermarkets are also taking initiatives there. Grupo Pão de Açúcar, the biggest retailer in Brazil
has developped the TAEQ brand with full traceability:
http://www.qualidadedesdeaorigem.com.br/fase3/carne-programa.htm
They are all profiting from better prices in the market with those initiatives.
6. Mike Zerr, Economist, Cargill Beef
Most of the livestock marketing projects I have seen fail do so because they start at the producer end
instead of the customer end. The successful ones start out as a solution to a customer need and the
organizer works backward to create a supply chain. The chain sustains because the customer does not
want to lose the supply of animals that serve as his solution and the producers don’t want to lose access
to the customer (who is paying them enough to cover the cost of the extra work plus sharing with them
the some of the profit generated by the solution). The relationship is mutually beneficial- it's not held
together by good intentions. Rather, it persists because everybody involved would be worse off it
didn't. Within Cargill we have lots of examples of how this works. A large part of our supply of cattle for
Japan is generated by a dedicated marketing group. The cattle are age and source verified from birth
and coordinated to flow from individual producers to designated feedlots and eventually scheduled for
slaughter just prior to the age cutoff for Japan. The producer group had been around for awhile but was
focused on sharing carcass performance with the members (most ranchers never know how their cattle
perform in the plant). The group shared the data and this helped the group make better breeding
decisions- and ask more for their cattle given proven performance. The group really took off when
Japan opened up to under 20 cattle and the group realized that they were uniquely qualified to provide
age and source verified cattle. Cargill had a list of customers who needed the meat and the group had
the ability to meet the customer need. When I was in Vietnam several years ago, a feed company
organized a supply chain of chickens to qualify for "label rouge" for the French ex-pats using basically
the same model. Everybody in the chain was better off in than out of it (the customer got label rouge
certified chicken, the feed company sold more feed and the producer got more for his chickens). The
other part I would mention is that every successful example has a champion in the chain that drives it
forward. Keeping everyone on board is a full time job and the successful examples treat it as such.
7. Ing. Jorge Luis Rejis Núñez, Director, Soluciones Agropecuarias SSP, Tte. Jara 867 c/ Heisecke
Asunción - Paraguay
Fernando Herrera president of the ASOCIACION DE PRODUCTORES EXPORTADORES ARGENTINOS (APEA)
is e 20 year old producer organization to export meat specialy Hilton cuota to Europe.
In Uruguay there are several organization of livestock producers that work to add value exporting their
products.
I have also read about cooperatives of livestock producers in Brazil that export their own product.
If this information is what you looking for I can get more precise contact information.
8. Victor Ahumada B, Docente Biosistemas de Producción, Escuela de Ciencias Veterinarias,
Universidad Viña del Mar - Chile
Here in Chile I know about only one succesfull group in beef cattle marketing. I'm sure that the reason is
the leader of that organization, Paty English, veterinarian and comercial business manager of CARNES
ANDES SUR who set up an interesting business model in beef production based in the association of
small producers. For more information you can visit the WEB Page www.carnesandessur.cl
You can contact her at the e-mail ternuradelcampo@carnesandessur.cl
9. William (Bill) W. Westman ,Vice President, International Trade, American Meat Institute
You could take a look at Brazil. That example, though, is blessed with abundant arable, productive land
and tremendous fresh water resources. Their marketing programs have been very successful backed up
by an efficient and productive processing industry. Their only constraints have been low grain (corn)
productivity, inadequate infrastructure, and the high cost of capital. But, all of these problems are being
addressed. With the anticipated influx of foreign investment (China!) Brazil has a bright future. "The
country of the future" has always been the joke about Brazil.....but the Brazilians appear poised to really
benefit from their bountiful resources.
10. Martin Upton, Professor emertitus, Reading University
We had problems finding a successful example for our Chapter on Marketing, in Livestock and Wealth
Creation (2005). Nottingham University Press. We ended up with an example of local woolgrowers'
associations in the Eastern Cape of South Africa. Details were published in a book (Joint Belgian
Universities and South African Universities effort) 'Local institutional innovation and pro-poor
agricultural growth: The case of small-woolgrowers' associations in South Africa.'(2003). Edited by M.
D'Haese, N.Vink, G. Van Huylenbroeck, F Bostyn & J. Kirsten Published by GARANT. In 2003 the
associations were claimed to be working successfully, but I don't know of
their present status.
11. PAUL J. STRYDOM
GENERAL MANAGER
MEAT BOARD OF NAMIBIA
Depending on what you expect or requires and definition of marketing groups, Namibia has some
"groups" operating/in place to assist producers on a constant basis in improving livestock marketing
(which is not encompasses in a project). I assume your request is only applicable to
smallholder/communal set ups.
a. Livestock Producers south of the Veterinary Cordon Fence (- these permanent establish financed
either by themselves or through specific projects).
(i) The Meat Board established in cooperation with the Producer organisation Livestock
Marketing Committees (LMC) to (a) assist producers with information as well logistics with marketing,
be it to auctions, abattoirs or exports - these LMC are contacted and used on a regular basis amongst
others to develop strategies, i.e. Rift Valley vaccinations; and (b) to meet on a frequent (annual) basis
with auctioneers/sale yard operators to establish annual/monthly auction/sale yard programs/activities;
(ii) Marketing groups can also encompass Farmers Associations dealing with all aspects of
agricultural sector, inclusive combined delivery to the slaughterhouses, e.g. Meatco
(iii) Other aspects being death with are livestock shows, etc
b. Livestock Producers north of the Veterinary Cordon Fence (only (iii) are financed by the Meat Board).
(i) Livestock Marketing Committees exist as per (a) (i) above. In addition these LMC has been or are
being used to identify and support special projects of the Meat Board, e.g. the placement of bulls or the
identification of producers partaking in the Livestock Producers Forum (LPF) Northern Communal Areas
(NCA) Farmers Mentorship program.
(ii) Farmers Associations do exist, but to a limited scale. Some areas also do have co-operatives
(Caprivi) to assist with livestock marketing and associated negotiations with local slaughterhouse,
Meatco.
(iii) The Meat Board on behalf of the Livestock Producer Forum (LPF) engaged in a huge multimillion (Nam$) mentorship program, the LPF NCA farmers mentorship program whereby 350 farmers
will be mentored to increase supply/off-take to slaughterhouses. It is perhaps too soon to indicate
results, but feedback from farmers are very positive -in such a manner that producers excluded from the
program are attending mentoring activities at own cost. Producers south of the veterinary cordon fence
are paying for the program through the payment of levies/check-offs.
12. Bert Rayner
Oztralia Marketing International Pty Ltd
Australia
In South Africa many poor people have done very well in sharing investments
and oppurtunities using what is called a STOKVE system .Worth investigating
I am South African born but live in Australia
13. Dr. Evelyn Mathias
League for Pastoral Peoples and
Endogenous Livestock Development
Müllenberg 5a
51515 Kürten
Germany
In 2008, we sent out a call for cases on community-based niche marketing efforts focussing on products
from local livestock species and breeds. The outcome was the attached booklet. The first project on
Deccani wool is probably the oldest and in my eyes the most successful of the non-dairy efforts.
Unfortunately it seems that cases of livestock marketing products run by local producers are rather rare.
14. Dugasa Dirbaba, Ethiopia
There are successful marketing groups in Southern Ethiopia Borana and
Guji areas. They were organized to alleviate livestock market problems
of pastoralists in these areas and at the same time to generate income
for the members of the group.
15. Ugo Pica-Ciamarra, FAO
Have a look at section 3.1.7 and section 3.3.4 and reference
therein. http://www.fao.org/docrep/012/i1520e/i1520e00.htm
Attached is also an Oxfam manual.
16. Antonio Rota
IFAD, Senior Technical Adviser
Livestock and Farming Systems
I have been impressed by the experience with Livestock Market Access
Companies (MAC) in Kenya where Masaai pastoralists (including a women
group, please see below for info) get organised to sell livestock in
Nairobi (in Kiseria, where a slaughterhouse is operating). You'll get
the full picture from Michael Kibue, Kenya Livestock Working Group
[sardlivestock06@yahoo.com]or from SARD/Heifer in Kenya. Why it works? I
think the key elements are mostly two: the human factor (the process is
driven by highly motivated persons with a common socio-cultural
background); the economic factor (all stakeholders along the value chain
get "money in their pockets" and a growing demand exist for meat
products).
17. Anni McLeod, Senior Officer (Livestock Policy)
AGAL, FAO, Viale delle Terme di Caracalla, 00153 Rome, Italy
1. A paper (attached) sent by Tabitha Kimani (ECTAD socio-econ Kenya) on marketing of pastoralist
animals on the Kenya/Ethiopia border. An absence of marketing groups, but an interesting point was the
importance attributed to kinship - family and clan arrangements affect one's access to livestock markets.
2. A recent report by Catley at al. from the IGAD project, well worth a look because it describes the way
that livestock owners behave given the market conditions they face
https://wikis.uit.tufts.edu/confluence/display/FIC/Livestock+Exports+from+the+Horn+of+Africa
3. The example of the Kalahari Kid Company, in the attached report from FARM Africa. Here we have a
company that is set up to support small scale producers to market goats.
4. The "Bangladesh poultry model" implemented by BRAC since the 1970s and reviewed in 2002
(Dolberg, F., Mallorie, E. and N. Brett. 2002. ‘Evolution of Poultry Model – a Pathway out of Poverty.’
Paper presented at the workshop People Fight with Poultry. Learning from Bangladesh Experience held
in Dhaka, October 20-24 organised by the International Network for Family Poultry Development. 18pp).
It's based on a model that operates at community level, but its not really a co-operative model. Most of
the input and output marketing services are provided by BRAC. The model has some problems but has
also been beneficial to a lot of people.
5. The PALD project in Viet Nam run by AVSF that supports "livestock interest groups"
http://www.avsf.org/uk/article.php?rub_id=140&art_id=233 I seem to recall that it started because of
an interest in improving pig sales.... don't know how successful it has been
18. Abdi Jama
FAO IGAD LPI
I am aware of a women association/group (see below) that were set up in southern Ethiopia created by
USAID project that has been around for a while (attached). I have copied my friend Dr. Getachew
Gebru who was involved in the project to give you more information.
19. Hamid Ahmad
Pakistan
I strongly doubt sustainabilty of such groups in livestock marketing (dairy excluded). Individual efforts
are nore profitable in such activities. It is difficult to perform equally well in livestock
marketting groups,while individually, it is believeable , "As you sow, so
shall you reap".
20. Vincent Porphyre <vporphyre@gmail.com>
In response of your mail, I suggest you to visit our website http://pigtrop.cirad.fr where several
experiences in pig producers groups are described.
for example, see the following reports in the pages:
* http://pigtrop.cirad.fr/resources/library/referenced_books/economy
* http://pigtrop.cirad.fr/subjects/rural_development
in addition, I forward your request to our 2500 members in the PIGtrop network to know their own
experiences.
21. Dil Peeling, IGAD,
I n our attempts to clarify the links between markets and poverty reduction, we looked a little at the role
of marketing groups in the IGAD region. You might find pages 26-36 of this working paper from our
website worth dipping into: http://www.igad-lpi.org/publication/docs/IGADLPI_WP2010_01.pdf
22. Beatriz C.
I think the problem is that we "push" to establish this groups and most of the time the producers are not
ready to do it. In this case, maybe, this is part of an institutional project but isn´t the livestock
producers project. I saw good experiences in Brasil, in cooperatives of the Movimiento de los Sin Tierra,
in dairy and pork production. I think you should contact someone in that country beacuse I visited them
several years ago but dont´t know how they are functioning now.
23, Dr. M. Afzal
PARC, Islamabad
Recently run USAID project run by FAO in Balochistan had success in these markets. I do not know the
details but you can check with them.
24. Carmen Jaquez, Land O’Lakes
We set up livestock producer groups in South Sudan. Our groups are doing fairly well and we had a lot
of lessons learned.
25. Jim Kerr , ACIAR Project AH/2006/025: Understanding livestock movement
I am forwarding your query about the pig marketing groups in Cambodia to Socheat Sieng, our project
consultant there. They still seemed to be operating in mid-2008, as some traders complained at one of
our meetings about the adverse effect they were having on trader profitability at that time.
I wonder whether CIAT/SADU attempted any group marketing initiatives in their activities with livestock
producers in Xieng Khouang province in Laos?
26. Enrique
It is so rare, some cooperatives have some success. An example of this is in Colombia in poultry
industry: "Pollos Vencedor" www.vencedor.coop/
27. DR.Raghavan(ragha@streamyx.com), Malaysia .
I just would like to give you the marketing system in Malaysia. In the early days the marketing of chicks,
feed, and catching of broilers were done through a network of agents and distributors and they make
more profits than the producers.At that time the industry was still in its infancy and as time developed
in the early 80s more feed mills and breeder farms came in.The breeders starting marketing the chicks
direct to farmers and feed was still handled by agents.The marketing of broilers was still through the
middleman who fix the price at their own whims and fancies.This prompted many feed millers to go into
integration where feed, chicks and tech services are given by the feed millers and birds bougtht over at a
contracted price and processed.Those middlemen who were involved in the early days are given the
processed birds to sell in the wet markets so as to stop the slaughter of birds in the marketing.This
system of complete integration has helped to solve the marketing issues.
There are associations--Broiler Producers, DOc producers,Commercial egg producers, all under the
umbrella of the Federation of livestock farmers association.They meet every week to decide on the
selling prices of farm products, and this is followed by the producers.Direcr sales is to all the
supermarkets, restaurants, hotels by the producers with credit terms 30 days and sometimes on cash
basis and the end user gets a discount of 3-5% per consignment.Sales man are employed for the
collection.The integration system has brought about complete changes in the marketing of poultry meat
with added value products and more integrators listed in the stock markets.Broilers integration
with feed mills, brreder farms, processing about 10 in the stock market, and layers about 8.Feed prices
are decided at the monthly meetings depending on the prices of feed ingredients and feed prices are
controlled by the integrators as per association rules.
The marketing pattern.
1. Breeder Farms, Feedmils, Processing owned by Integrators who is normally a feed miller.
2.He has a number of contract growers--he supplies the feed, chicks, vet services and catches the
birds and at the end of the day the integrator minus all the expenses and repays the farmer.The prices
of chicks , feed,are fixed for a period of six months and revised.
3.Supplies to goverment agencies, hospitals, hostels in the university, etc are on tender basis called by
the respective authorities.
4.The egg marketing is also direct as per the broilers.Due to competition now amny has gone into
speciality eggs --SE enriched eggs, omega three eggs, Vit E enriched eggs etc.
Direct sales has benefited the consumers as no hazle is involved on the pricing etc.Only during the
Festival season the goverment keeps an eye on the pricing to make sure the producers dont take
advantage and increase prices, during the muslim festival, christmas etc.
For the swine sector it is still through the middle men but some producers slaughter on their own
in goverment owned slaughter houses and do dirct sales to custoomers.
In India the same system of integration and processing is taking place but very slow and still the
market is live birds and controlled by middlemen.The same for eggs where the middlemen collects the
eggs from designated farms at a designated price and export it out to the middle east etc from the
layer belts.It will take sometime for integration to catch up in India as most people are vegetarians and
many house wives prefer to go to wet markets and buy.Again there is no co-ordination
in INdia.Association decides something but practice is different.Enery body wants to be number one
but no one can be.
In Bangladesh integration is catching up but broilers and eggs are still through the middlemen though
processing is on a small scale and not properly organised.
In short the marketing of poultry meat,eggs, thorugh an integrated systme has proved successful in
Malaysia, and Bangladesh and India follows similiar trends but will take time as I have given a
number of lecturers on various occasions and things are slowly moving.
You must have a good association with dedicated people to work and you must have coordination
among all of them to make direct marketing to customers.This is all my views.ou are welcome for
any clarifications.
28.: Suhaimi, DVS Malaysia
I think the Japanese system of auctioning carcasses in the slaughter house is a a better solution than
managing a group of farmers with all their different characters
29. Sally Bulatao, Phillipines
1. In hogs, there are many but I know of two that I have personally visited. The hog cooperative
in Soro-soro in Batangas and CAFFMACO in Cavite. I know that they are very much in
business and both coops have a broad base of members who are hog raisers. They both started as
small groups but have grown to have their own feed mills that distribute feeds to hog raiser
members, sometimes as loan in kind in exchange for fattened hogs that the coop then sells.
CAFFMACO has a credit program that members truly value and make them stay with the coop.
Soro-soro, when I visited some years back, has diversified into other businesses that serve their
members including cable TV connection.
The local auction markets are also good examples. Although I suspect that traders dominate
these, they are quite open and farmers around the area can actually participate in buying and
selling livestock (Padre Garcia in Batangas and Zamboangita in Negros Oriental near Dumaguete
and many more hold regular weekly auctions that huge numbers of people go to.)
2. I have written in a recent email about the women broiler raisers that you may also use as an
example.
<http://www.balaymindanaw.org/bmfi/newsupdates/2007/03manok.html>
From previous seminars, I have heard that Bangladesh has a much more integrated, smallholder
based poultry.
30. David Michael, Wondu Business & Technology Services, AUSTRALIA
Marketing is a complex function and one of the mistakes in the design of many collaborative
group projects is working on the assumption or belief that a collaborative marketing project can
solve all the marketing problems of group members. It cannot do this. Individual suppliers are
still going to be responsible for many marketing functions like control of quality and making
decisions about when and where to sell and what quantity. The key question that has to be asked
is about exactly where the market is failing and then pinpointing solutions to that area. One area
that markets can fail in is having good information about prices, trading activity etc. This doesn’t
mean the whole market has failed, just one part of it. Projects that enhance market information
for producers can endure. For example, the Livestock Market Information System in Ethiopia,
supported I think by USAID.
http://links.tamu.edu/Pages/Public/About.aspx?&selectedTab=3&selectedMenuId=0&menuState
Is this project sustainable? Not sure but it may be possible to set up an information charge that's
sustainable. Again however, another problem, even if it works for a while is to think that the
business model for charging is set in concrete. It's not. Markets keep changing and the nature of
the market information demanded is very likely to evolve over time. Unless market information
providers keep up with these changes they will quickly find few people will pay for the service.
Markets are very dynamic places and the functions demanding and requirements ever changing.
Another example is the cooperative marketing model. Sometimes this model works in mobilizing
resources and gathering together enough producers to gain some economies of scale. Again,
however, the business model has to keep evolving to ensure members place value on the service.
Furthermore, when the cooperative model does work it paradoxically seems to also sometime
stimulate the emergence of private marketing firms. For those who started the cooperative this
can sometimes be hard to accept. But that's the start of the working of an efficient and
competitive market. In these circumstances the original cooperative group may be acquired by
the private firm or even disappear. But I would not say this is a failure of the original marketing
group, rather it’s a success. It does, however, underline the care needed in M&E of marketing
projects.