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2. Trends in production, trade and consumption


Production: Resource base, levels and trends
Dairy trade and prices
Trends in consumption


Production: Resource base, levels and trends


Regional overview
Regional and subregional production trends and performance


Regional overview

2.01 Production of dairy products in sub-Saharan Africa over the last two decades has been characterized by a rapid growth in total output during the 1960s, followed by a deceleration in the rate of growth during the 1970s. As such, most dairy products registered only minor increases in their absolute quantity levels between 1970 and 1980 (see Table 9). However, per caput production of dairy products declined throughout the two decades, mainly as a result of the fast growth in human population throughout the region.

2.02 Trends in livestock output generally reflect changes in livestock populations and their productivity. During the 1960-1930 period the ruminant livestock populations in sub-Saharan Africa generally increased in numbers, and increases in both milk and meat production in the region during the two decades generally reflect the trends in livestock populations (Table 4). However, the growth in output of livestock products could not keep up with growth in human population, hence the declining per caput production of livestock products.

Table 4 Changes in Livestock Numbers, Output and a Productivity in Sub-Saharan Africa, 1960-1980a

PARAMETERS

OUTPUT

1960

1970

1980

Cattle population (million)

96.9

131.6

148.8

Small ruminant population (million)

160.8

289.3

238.8

Meat production (all types) (million tons)

1.6

2.7

3.2

Milk production (cow's only) (million tons)b

-

5.0

5.6

Beef yield (kg/head)

12.8

13.3

13.9

Milk yield (kg/head)b

-

37.7

37.8

Meat production (all types) per caput (kg)

8.0

10.2

9.1

Milk production (cow's only) per caput (kg)b

-

19.0

16.0

a All estimates derived from FAO Production Yearbooks.

b Data on milk production are considered to be particularly inaccurate for the 1960s period, hence they were omitted in the original calculation.

SOURCE: ILCA Annual Report 1982 (Published 1983).

2.03 The distribution of ruminant livestock populations, the major resource in the production of dairy products, differs between subregions and within countries in sub-Saharan Africa. Even though the cow continues to be the major source of milk and milk products in sub-Saharan Africa, camels, sheep and goats are also significant sources of the total output of dairy products in the region.

2.04 Indigenous zebu and taurine breeds of cattle virtually constitute the entire herd of cattle in sub-Saharan Africa. The indigenous cattle breeds are characterized by low productivity. Lactating cows rarely achieve a milk yield in excess of 200 litres per lactation for human consumption. This yield performance is relatively poor when compared with typical yields of about 3000 litres of milk per lactation which are expected from imported exotic dairy cows, such as Friesian or Jersey breeds (ILCA Bulletin No. 4; June 1979). Sub-Saharan Africa, therefore, appears to have the potential to improve dairy production through a strategy of adopting high-yielding exotic dairy breeds of cattle, or through a programme of cross-breeding to improve the yields of indigenous cattle breeds. However, dairy production in the region is also constrained by a number of some environmental factors which will be highlighted later in the paper.

2.05 The sub-Saharan Africa region can be classified into five major ecological zones, namely (i) arid, (ii) semi-arid, (iii) subhumid (iv) humid, and (v) highland zones. The distribution of the ruminant livestock population in sub-Saharan Africa by livestock species and ecological zones, including the share of each type of ecological zone in the total land area in the region, is given in Table 5.

Table 5. Distribution of Ruminant Livestock Populations by Species and Ecological Zones in Sub-Saharan Africa for the Year 1979

Ecological Zoneb

Cattle 1000 Head

Sheep 1000 Head

Goats 1000 Head

All Ruminantsa 1000 TLU

(%)

(%)

(%)

(%)

Arid

31,462

37,063

48.287

41,697

(37.3)

(21.3)

(35.7)

(38.6)

(30.4)

Semi-arid

45,454

23,071

33,215

37,446

(18.1)

(30.8)

(22.2)

(26.5)

(27.3)

Subhumid

32,758

14,153

20,266

26,370

(21.7)

(22.2)

(13.6)

(16.2)

(19.2)

Humid

8,814

6,177

11,586

8,148

(18.5)

(6.0)

(7.9)

(9.2)

(5.9)

Highlands

29,022

21,401

11,933

23,646

(4.4)

(19.7)

(20.6)

(9.5)

(17.2)

TOTALS (sub-Saharan Africa)

147,510

103,865

125,287

137,308


(100.0)

(100-0)

(100.0)

(100.0)

a Includes camels
b The figures in parentheses under ecological zones give percentage of total land area of sub-Saharan Africa that is covered by the given zone.

SOURCE: Jahnke (1982), pp. 19-21.

2.06 The data presented in Table 5 indicate that most of the ruminant livestock populations in sub-Saharan Africa are concentrated in the arid and semi-arid zones, with about 37% of the TLU4 being found equally distributed between the subhumid and highland zones and only about 6% of the TLU being found in the humid zones.

4 TLU = Total Livestock Units, as standardized measure of livestock numbers, whereby a camel is taken as equivalent to one Livestock Unit (LU), while one head of cattle is equivalent to 0.7 of LU, and a head of sheep or goat is equivalent to 0.1 of LU (see Jahnke; 1982, p. 10).

2.07 Dairy production in sub-Saharan Africa is constrained by a number of factors, which may be classified as being biological, climatic, and socio-economic in nature. The extremely low dairy production in the humid zones of sub-Saharan Africa - primarily in the Central and Western Africa subregions - is attributed to a virtual non-existence of livestock populations in these zones which are infested by the tsetse fly, the vector of trypanosomiasis. Only indigenous (local) cattle breeds thrive in the arid and semi-arid zones which occupy more than 50% of the land area in sub-Saharan Africa (a bio-climatic constraint to increasing dairy production). The arid and semi-arid areas are also the home of pastoral/nomadic cattle herdsmen, whose main purpose for milk production is for their own and family consumption. There are also some technical constraints to improving dairy production. Exotic cattle breeds and the crossbred cattle, which easily outyield the indigenous cattle breeds in milk production, tend to thrive best under the high potential, temperate highland areas, where high standards of dairy management are required. Such high potential areas are often characterized by mixed farming so that dairying may only be one of the many economic activities of producers. Under such circumstances, the choice of the type of economic activities to pursue will depend on the profitability of alternative enterprises. However, nutritional considerations may also affect the choice of the activities, since nutritional aspects will influence the family's production decisions as far as food production is concerned.

2.08 The data presented in Table 4 indicate that both livestock numbers and the output of livestock products in sub-Saharan Africa recorded an increase in absolute amounts over the 1960-1980 period. However, the growth in numbers of the ruminant livestock species occurred at much lower rates during the 1970s than during the 1960s. A major cause of the deceleration in growth during the 1970s was the severe drought which decimated herds, especially in the Sahel and Ethiopia. However the drought crisis in the Sahel and some parts of Eastern and Southern Africa does not explain why there was an overall deceleration in growth of livestock populations in the rest of sub-Saharan Africa, where cattle populations grew at a rate of 3.7% per annum during the 1960s, but where the rate fell to 2.1% per annum during the 1970s (ILCA Annual Report 1982). The causes of such a deceleration are believed to lie in either a decrease in fertility and/or an increase in mortality. Increasing regional conflicts and wars, frequent outbreaks of disease, and poor livestock husbandry (which contributes to the poor nutrition) have undoubtedly contributed to the poor performance of livestock in sub-Saharan Africa in terms of growth both in livestock numbers and their productivity during the 1970s (ILCA Annual Report 1982).

Regional and subregional production trends and performance

2.08 The overall increase in the output of dairy products in sub-Saharan Africa during the last two decades is believed to have been more due to an expansion of livestock population rather than due to improvements in livestock productivity. This proposition has been supported by some recent work carried out at ILCA (McClintock, 1983).

2.10 Even though the cow is the main source of dairy products in sub-Saharan Africa, the camel becomes more important as one moves into the more arid parts of the region, particularly in the Sahel and in some parts of Eastern Africa. Table 6 gives an idea of the importance of the various ruminant livestock species as sources of dairy products in sub-Saharan Africa during 1978. However, one must realize that data on milk production from camels ere rarely properly recorded, so that the figures for milk production from camels as given in Table 6 are even more of a guess than for milk from other livestock populations and are based on estimates from the census of camel populations and the expected yield of milk per head of camel.

Table 6 Milk Production in Sub-Saharan Africa by Ruminant Livestock Species in 1978

Ruminant Livestock Species

Amount of Milk (1000 Metric Tons)

% Share in Total Output

Camelsa

2,200

23.6

Cattle

5,627

60.3

Sheep & Goats (Shoats)

1,507

16.1

TOTAL PRODUCTION

9,334

100.0

a Estimates based on yield of 200 kg of milk per head of camel, which is considered farily conservative when compared with the figures quoted in the survey by Dahl and Hjort (1976).

SOURCE: Adapted from Jahnke (1982), p. 30.

The data presented in Table 6 suggest that camels are second to cattle In terms of their share in total milk output in sub-Saharan Africa, despite their limited distribution in the region (Jahnke, 1982, p. 31). Buffaloes are an important source of dairy products in a number of developing countries, particularly in the Asian subcontinent and also in Egypt in North Africa,, but this ruminant animal has not yet been domesticated in any country within sub-Saharan Africa.

2.11 When compared with the dairy output performance in the developing countries as a group, the performance in dairy production in sub-Saharan Africa can be judged to be poor. Table 7 gives a comparison of growth rates in the production of the various types of dairy products by the major world regions (or country groupings) and for sub-Saharan Africa for the 1963-1980 period.

Table 7 - Comparison of Growth rates in Production of Various Dairy Products by Major Work Regional Groupings, 1963-1980

REGION/TYPE OF PRODUCT

PERIOD & ANNUAL GROWTH RATES

1963-1970

1970-1980

1963-1980

1. WORLD:





(i) Liquid whole cow milk

1.8

1.6

1.7


(ii) All* liquid whole milk

1.7

1.7

1.7


(iii) Dry whole cow milk

7.8

5.4

6.4


(iv) Dry skim milk and buttermilk

6.4

3.4

4.6


(v) Evaporated and condensed milk

1.4

0.3

0.7


(vi) Cheese

1.1

4.0

2.8


(vii) Butter and Ghee

0.9

1.6

1.3

2. DEVELOPED COUNTRIES:





(i) Liquid whole cow milk

0.6

1.3

1.0


(ii) All* liquid whole milk

0.7

1.3

1.0


(iii) Dry whole cow milk

5.9

5.5

5.7


(iv) Dry skim milk and buttermilk

6.0

2.3

3.8


(v) Evaporated and condensed milk

-0.9

-1.3

-1.1


(vi) Cheese

4.0

4.3

4.2


(vii) Butter and Ghee

-0.2

-0.5

0.2

3. DEVELOPING COUNTRIES:





(i) Liquid whole cow milk

3.2

3.1

3.1


(ii) All* liquid whole milk

2.7

3.1

2.9


(iii) Dry whole cow milk

19.4

5.8

11.2


(iv) Dry skim milk and buttermilk

-18.9

12.6

-1.6


(v) Evaporated and condensed milk

6.9

3.7

5.0


(vi) Cheese

-9.8

2.3

-2.9


(vii) Butter and Ghee

2.3

2.5

2.4

4. SUB-SAHARAN AFRICA:





(i) Liquid whole cow milk

1.6

1.3

1.4


(ii) All* liquid whole milk

2.1

1.3

1.6


(iii) Dry whole cow milk

29.8

-3.4

9.1


(iv) Dry skim milk and buttermilk

17.5

-4.8

3.9


(v) Evaporated and condensed milk

N/A

-30.7

N/A


(vi) Cheese

18.5

9.2

7.4


(vii) Butter and Ghee

1.6

0.9

1.7

* All liquid milk refers to liquid milk from all animal sources, except camels.

N/A implies "not applicable" (since value at basis was zero).

SOURCE: Calculations by author based on data in the Appendix Table A.I.

2.12 Liquid milk (from all ruminant livestock sources) can be taken as the main dairy product because all the other dairy products, as recorded in the published statistics, are basically derived from the recorded or estimated total liquid milk production in each country. Therefore, developments in total liquid milk production generally indicate the output performance of the dairy industry. The parameters which have been presented in Table 7 indicate that the rate of growth in milk production in the developed countries almost doubled from about 0.7% per annum during the 1960s to about 1.3% per annum during the 1970s. Over the same period, the growth rate in world total milk production actually stagnated at around 1.7% per annum, while the corresponding annual rates of total dairy production growth for the developing countries as a group and sub-Saharan Africa as a region changed from 2.7% to 3.1% and from 2.1% to 1.3% respectively. Evidently, the rate of progress in dairy production in sub-Saharan Africa declined between the 1960s and 1970s.

2.13 Although the highest growth rates in dairy production have occurred in developing countries during the last two decades these countries still constitute milk-deficit areas in general, while developed countries are generally milk-surplus regions. Since the developing countries also experience much higher population growth rates, these countries have experienced declining per caput milk production over the last two decades. In terms of aggregate output, the developed countries (excluding Eastern Europe and the USSR) contribute 45%, Eastern Europe and USSR contribute 31% while the developing countries contribute 24% of the total world dairy production. Despite the fast growth rates in dairy production that have been recorded for Eastern Europe, USSR and developing countries during the last decade, the above dairy production shares by different world regions are not expected to change significantly during the 1980s (FAO, 1978).

2.14 Dairy production in the various subregions (country groups) within sub-Saharan Africa varies between and within subregions. Table 8 gives a comparison of dairy production growth rates in the various subregions of sub-Saharan Africa during the 1963-1980 period. The parameters given in Table 8 indicate that the Eastern Africa and Western Africa subregions experienced significant growth rates in output during the last two decades. However, the dairy output performance in the rest of the region was not so impressive.

Table 8 - Comparison of Growth Rates in Total Dairy Output in the Subregions of Sub-Saharan Africa during the 1963-1980 period

SUBREGION/COUNTRY GROUPING

PERIOD & ANNUAL % GROWTH RATE

(No. of Countries) Type of Product

1963-1970

1970-1980

1963-1980

1. EASTERN AFRICA (9):





(i) Liquid whole cow milk

1.9

1.3

1.6


(ii) All* liquid whole milk

2.8

1.4

2.0


(iii) Dry whole cow milk

23.6

-5.0

5.9


(iv) Dry skim milk and buttermilk

12.1

-6.8

0.6


(v) Evaporated and condensed milk

N/A

-21.6

N/A


(vi) Cheese

10.6

3.2

6.2


(vii) Butter and Ghee

-0.9

0.2

-0.2

2. CENTRAL AFRICA (8):





(i) Liquid whole cow milk

-1.1

1.6

0.5,


(ii) AU* liquid whole milk

-1.2

1.8

0.6


(iii) Dry whole cow milk

0

0

0


(iv) Dry skim milk and buttermilk

0

0

0


(v) Evaporated and condensed milk

37.2

3.0

15.9


(vi) Cheese

0.3

2.4

1.5

3. WESTERN AFRICA (16):





(i) Liquid whole cow milk

2.8

1.6

2.1


(ii) All* liquid whole milk

1.8

1.4

1.5


(iii) Dry whole cow milk

N/A

-1.6

N/A


(iv) Dry skim milk and buttermilk

N/A

-1.6

N/A


(v) Evaporated and condensed milk

0

0

0


(vi) Cheese

30.1

0.7

11.9


(vii) Butter and Ghee

6.6

2.1

4.0

4. SOUTHERN AFRICA (II):





(i) Liquid whole cow milk

-0.5

0.7

0.2


(ii) All* liquid whole milk

-0.3

0.7

0.3


(iii) Dry whole cow milk

0

0

0


(iv) Dry skim milk and buttermilk

0

0

0


(v) Evaporated and condensed milk

N/A

N/A

N/A


(vi) Cheese

27.4

-0.3

10.3


(vii) Butter and Ghee

0.4

-1.3

-0.6

* All liquid milk refers to milk from all animal sources, except camels. N/A implies "not applicable" (since basic value was zero).

SOURCE: Calculations by the author, based on the data in the Appendix Table A.2.

2.15 Production of such dairy products as dried milk and evaporated and condensed milk generally reflect production of at least sufficient amounts of liquid whole milk in the sense of more than satisfying the immediate market. demand for liquid milk. Table 8 suggests that there has been a general decline in the rate of growth of the production of such milk products as dry milk and evaporated and condensed milk in sub-Saharan Africa over the last two decades. This trend reflects the increasing scarcity of liquid milk to satisfy the ever-increasing demand for liquid milk in most parts of the region, particularly during the 1970s. For instance, Eastern Africa and Kenya in particular managed to produce some dry whole cow milk and evaporated and condensed milk during the late 1960s and early 1970s, but the situation changed drastically by the end of the 1970s when even Kenya had to import some dry skim milk and butteroil for recombination into liquid milk in order to satisfy the local market demand.

2.16 Dairy production statistics for the four subregions of sub-Saharan Africa suggest that production of whole liquid milk from small ruminants has been expanding more rapidly than cow milk production over the last two decades. The situation regarding the expansion of camel milk production is still not well understood, mainly because statistics on camel milk production are hard to come by, and only rough estimates based on expected yield and estimated camel populations are usually available. Traditionally, the camel has been an important source of milk in sub-Saharan Africa, primarily in the arid and semi-arid parts of the region, especially in Ethiopia, Somalia and the Sahel group of countries. However, it appears that camel milk production has been on the decline even in the traditionally important camel milk producing areas (Paulino and Yeung, 1981; p. 10). Table 9 gives a breakdown of whole liquid milk (fresh milk) production from the different ruminant livestock species (other than camels), by subregions for the 1863-1980 period. The table also gives the trends in the rates of growth of milk production during the same period.

2.17 Table 9 indicates that whole liquid milk production from cows has made some significant but not adequate gains since the 1960s, the changes in absolute amounts over the 17-year period being 30% for Eastern Africa, 9% for Central Africa, 42% for Western Africa, and 13% for Southern Africa. The overall change in the absolute amount of cow milk production for the entire region (SSA) was 27% during that period.

Table 9 - Trends in Growth Rates and Volumes of Production of Fresh Whole Milk in Sub-Saharan Africa by Animal Source* and Subregions, 1963-1980 (Production in 1000 Metric Tons)

REGION/COUNTRY GROUP (No. of countries) ANNUAL SOURCES

PRODUCTION

% ANNUAL GROWTH RATE

% CHANGE

1963

1970

1980

1963/70

1970/80

1963/80

1963/30

1. EASTERN AFRICA (9):
















Fresh: cow milk

2787

3186

3624

1.93

1.30

1.56

+30


sheep milk

102

256

299

14.05

1.56

6.53

+193


goat milk

551

731

860

4.12

6.27

5.38

+144


TOTAL:

3440

4173

4783

2.80

1.37

1.96

+39

2. CENTRAL AFRICA (8):








Fresh: cow milk

261

242

284

-1.07

1.61

1.50

+ 9


sheep milk

1

2

2

-10.41

0

4.16

+100


goat milk

13

9

16

- 5.92

5.92

1.23

+23


TOTAL:

275

253

302

-1.18

1.79

0.55

+10

3. WESTERN AFRICA (16):








Fresh: cow milk

784

949

1117

2.77

1.64

2.10

+ 42


sheep milk

89

110

115

3.07

0.44

1.52

+29


goat milk

302

272

291

-1.48

0.31

-0.44

7


TOTAL:

1175

1331

1523

1.80

1.36

1.54

+ 30

4. SOUTHERN AFRICA, (11):








Fresh: cow milk

606

584

626

- 0.53

0.70

0.19

+ 13


sheep milk

2

1

1

N/A

0

N/A

N/A


goat milk

13

19

20

5.57

0.51

2.57

+ 54


TOTAL:

619

604

647

- 0.35

0.69

0.26

+ 5

** SUB-SAHARAN AFRICA (44):








Fresh: cow milk

4438

4961

5651

1.60

1.31

1.43

+ 27


sheep milk

192

369

417

9.78

1.23

4.67.

+117


goat milk

879

1031

1187

2.30

1.42

1.78

+ 35


TOTAL:

5509

6361

7255

2.08

1.32

1.63

+ 32

* Excepting camel milk production, for which statistics are available.

N/A implies "not applicable" (since basis value was zero).

SOURCE: FAO Production Yearbooks (1973; 1981), with calculations by the author.

Sheep milk production appears to have made the highest gains in terms of production expansion during the 1963-1980 period, the highest gains having been made in Eastern Africa, followed by Central, Southern and Western Africa subregions in decreasing order. However, the data on small ruminant production are notoriously unreliable.

2.18 Central Africa and Southern Africa experienced negative growth rates in the production of whole liquid milk during the 1960s primarily due to a drop in whole liquid cow-milk production. The two subregions of the Sub-Saharan Africa made only a relatively moderate recovery in liquid milk production during the 1970s (see Tables 8 and 9). In terms of total whole liquid milk production (referred to as "All Liquid Whole Milk" in Table 8, and as "TOTAL" in Table 9), the Eastern Africa subregion had the best production performance over the last two decades. In absolute amounts. Eastern Africa produces nearly three times as much milk as that produced by Western Africa, the next largest milk-producing subregion in sub-Saharan Africa.

2.19 Available dairy production statistics, as presented in Table 9, generally relate to total dairy production. No breakdown of production in terms of how much of the total production was consumed by the producing households (i.e. unmarked production) and how much of total production was marketed is usually available. However, an idea of how much of total production is marketed may be grasped from the discussion of marketing systems and marketing structures, which is presented in part three of this paper.

Dairy trade and prices


World perspective
Dairy trade in sub-Saharan Africa; trends and the share in the value of the world dairy trade
Trends in prices of dairy products


World perspective

2.20 Despite the relatively moderate growth in world milk production during the 1970s (estimated at about 1.7% per annum- see Table 7), the world supply of dairy products still exceeds commercial demand5. This situation, which has persisted through most of the 1970s, has led to the stockpiling of dairy products (notably skim milk and butter) in the developed countries, the world's main producers of dairy products.

5 This relates to effective demand in the sense of the amount of dairy products that can be sold at commercial (international market) rates or prices.

2.21 The growing discrepancy between dairy output and commercial outlets in most of the developed countries has been a result of deliberate government policies in these countries. For instance, most governments in Western Europe and North America have continued to support milk producer prices (even in the face of declining world market prices for dairy products) for social6 rather than economic reasons. This situation has enhanced milk production even in the high-cost producer countries of Western Europe, where supply has grown relatively fast while the rate of growth in demand for dairy products has been declining. The European Economic Community (EEC) has therefore become one of the major world milk-surplus regions during the 1970s. North America (particularly the United States) has also continued to be a major dairy-surplus region (FAO, 1978).

6 Farm support programmes are undertaken for social welfare reasons (e.g. to ensure that farmers' incomes are, stabilized and maintained at some desired levels), regardless of the costs of producing the products for which farm prices are supported.

2.22 Developing countries, which account for about 24% of the total output of world dairy products, constitute the main dairy-deficit region of the world. FAO estimates that the availability of cheap imports of dairy products from the developed countries (mainly in the form of dry skim milk and butter or butteroil) may have led to a situation whereby dairy development in developing countries has not received the priority that it deserves in recent times (FAO, 1978). Some of the dairy imports into developing countries have been by way of food aid, but the impact of such cheap sources of dairy products in the developing countries is still uncertain.

Dairy trade in sub-Saharan Africa; trends and the share in the value of the world dairy trade

2.23 Imports of dairy products into sub-Saharan Africa since the beginning of the 1970s have accounted for an average of 5.1% of the overall value of the world trade in dairy products, with the imports of milk alone accounting for about 11.8% of the average value of the world milk trade during the 10-year period. In 1980, the relative shares of the value of sub-Saharan Africa's imports of dairy products and milk alone in the value of the world trade in dairy products and milk alone were 5.5% and 12.2% respectively (Table 10).

2.24 Sub-Saharan Africa has rapidly changed its net dairy trade position from a small net importer in the early 1960s to a major net importer in the 1970s and early 1980s. Two major factors have contributed to this change:

(i) rapid population growth and rising per caput disposable income in the region, leading to a fast growth in effective demand for dairy products; and

(ii) slow growth in the production of dairy products in the region.

Table 10 - Value of the World and Sub-Saharan Africaa Trade in Dairy Products, 1970 and 1980, in US$ 1000

Region/Dairy Product

Period and Value

1970

1980

Worldb: (i) All Dairy Products

2,214,854

12,851,262


(4.7)

(5.5)


(ii) Milk only

798,980

5,076,864


(11.3)

(12.2)

Sub-Saharan Africa:




(i) All Dairy Products

103,846

705,055


(ii) Milk Only

90,582

619,785

a Only the value of dairy imports is given in the case of sub-Saharan Africa.

b The figures given for the value of world dairy trade are based on the average value of the world imports and exports of dairy products. The figures in parentheses give the share of the value of imports of dairy products into sub-Saharan Africa in the value of the world trade in dairy products.

SOURCE: FAO Trade Yearbooks (1973 and 1982), with calculations by the author - see Appendix Table A.6 too.

Generally, human population in sub-Saharan Africa has been growing at nearly twice the rate of growth in dairy production in the region during the last two decades. This factor has resulted in declining per caput production of dairy products in the region, and it is not surprising that the volume and value of dairy imports into the region have grown relatively fast over the last two decades.

Table 11 - Trends in Net Dairy Trade in Sub-Saharan Africa (Net Dairy Imports) by subregions & Products, 1970 and 1980 (Quantities in Metric Tonnes)

Region/Subregion and Product

Amount of Net Dairy Imports

1970

1980

1. Eastern Africa (9)b:




(i) Fresh milk

(-257)c

2,654


(ii) Dry milk

8,134

50,894


(iii) Evaporated and condensed milk

6,365

10,197


(iv) Cheese and curd

423

316


(v) Butter and ghee

2,065

5,225

2. Central Africa (8)b:




(i) Fresh milk

742

3,307


(ii) Dry milk

7,326

25,975


(iii) Evaporated and condensed milk

8,242

17,784


(iv) Cheese and curd

1,891

1,870


(v) Butter and ghee

1,651

2,695

3. Western Africa (16)b:




(i) Fresh milk

3,169

14,466


(ii) Dry milk

25,762

103,439


(iii) Evaporated and condensed milk

82,187

238,872


(iv) Cheese and curd

2,537

1,870


(v) Butter and ghee

3,980

16,128

4. Southern Africa (11)b:




(i) Fresh milk

30

18,057


(ii) Dry milk

12,116

25,785


(iii) Evaporated and condensed milk

18,706

4,251


(iv) Cheese and curd

3,687

2,910


(v) Butter and ghee

3,261

6,202

TOTALS FOR SUB-SAHARAN AFRICA (44)b:




(i) Fresh milk

3,684

38,484


(ii) Dry milk

53,338

206,093


(iii) Evaporated and condensed milk

15,500

270,104


(iv) Cheese and curd

8,538

7,049


(v) Butter and ghee

10,957

30,250

a With imports exceeding exports in all but one case (for fresh milk in Eastern Africa, 1970), the data presented give the net trade position as deficits in dairy products in all but one case.

b Number of countries forming the region/subregion.

c Eastern Africa was a net exporter in this case (hence negative sign).

SOURCE: Compiled from FAO Trade Yearbooks (1973; 1981); all calculations by the author.

2.25 The worsening net dairy trade position for sub-Saharan Africa is demonstrated by the fact that the regional dairy trade deficit was about US$43 million in 1960, US$113 million in 1970 and US$680 million in 1980. Even though part of this fast growth in the dairy trade deficit for sub-Saharan Africa could be attributed to inflation, the proportion of the total increase not attributable to inflation alone is estimated to about 80% of the total increase (von Massow, 1984 (a)).

2.26 The major dairy products which have been traded in sub-Saharan Africa have consisted of fresh milk, milk powder (dry skim milk, dry buttermilk, or dry whole milk), evaporated and condensed milk, cheese and curd, and ghee. To avoid a double-counting of imports and exports of dairy products at subregional level, one should consider only the developments of net trade situation. With dairy imports exceeding dairy exports in most cases, the net trade position for sub-Saharan Africa (both at regional and subregional -levels) is analysed primarily in terms of the developments in net dairy imports in this paper. Table 11 gives the developments in the net dairy import position for the subregions and the entire region of sub-Saharan Africa during the 1970.

2.27 Table 11 indicates that the imports of dry milk have constituted the bulk of dairy imports into all but one subregion of sub-Saharan Africa, namely Western Africa, where the major component of dairy imports has been evaporated and condensed milk. In terms of quantity, dry milk and evaporated and condensed milk have accounted for nearly 90% of all dairy imports into sub-Saharan Africa over the last decade.

2.28 At the regional level, aggregation of the subregional dairy imports and exports data presents no problem in reflecting the net trade position. Generally the exports of dairy products from sub-Saharan Africa have declined very sharply during the 1970s, while the dairy imports into the region have increased relatively fast during the same period. The consequence of this has been a rapid increase in both the value of dairy imports and the net trade deficit position of sub-Saharan Africa over the last decade. Table 12 indicates the developments of dairy exports and imports for the sub-Saharan Africa region in terms of the rates of growth in the quantities of dairy products which have been traded during the 1970s.

Table 12 - Rate of Growth in Quantities of Exports and Imports of Dairy Products in Sub-Saharan Africa, 1970-80

TYPE OF DAIRY PRODUCT (for all subregions)

% ANNUAL GROWTH RATES, 1970-1980

EXPORTS

IMPORTS

NET* IMPORTS

Fresh (liquid) milk

-15.2

11.1

26.4

Dry milk (skim/whole)

-19.5

13.9

14.5

Evaporated & condensed milk

-8.5

8.6

8.9

Cheese & curd

-37.0

- 2.5

-1.9

Butter and ghee

-19.4

8.2

10.7

* Net Imports = Imports less Exports.

SOURCE: Calculations based on data in Table 11 and others as compiled by the author from FAO Trade Yearbooks (1973; 1981).

2.29 The value of dairy imports into sub-Saharan Africa has increased relatively fast over the last two decades. For instance, the value of all dairy imports into the region was estimated at about US$41 million in 1960, about US$104 million in 1970 and about US$705 million in 1980. The corresponding figures for the value of the imports of milk alone into the region were about US$28 million in 1960, US$91 million in 1970 and US$620 million in 1980 (see Appendix Table A.6). These increases in the value of dairy imports into the sub-Saharan Africa region imply that the value of all dairy imports into the region grew at an annual average rate of 15.2% during the 1960-1980 period, the rate being lower (at 9.696 p.a.) during the 1960s but much higher (at 21.1% p.a.) during the 1970s. The corresponding rates of growth in the value of the imports of milk only were 12.3% p.a. for the 1960s, 21.2% p.a. for the 1970s, and 16.7% p.a. for the 1960-1980 period. This suggests that the value of the imports of milk alone has grown somewhat faster than the value of all dairy imports into sub-Saharan Africa over the last two decades.

2.30 The fast growth in the imports of dry milk and tinned evaporated and condensed milk into Western Africa is largely responsible for the large increase in the volume of dairy imports into sub-Saharan Africa over the last decade. Nigeria alone contributed nearly 30% to the increase in the value of dairy imports into sub-Saharan Africa during the 1970s, with the value of all dairy imports into Nigeria in 1980 accounting for about 40% of the total value of sub-Saharan Africa imports of dairy products7

7 Calculations based on the data presented in Appendix Table A.6.

2.31 At a regional level, the imports of fresh milk, milk powder, evaporated and condensed milk and butter and ghee all registered positive growth rates in volume (quantity) during the 1970s. The imports of cheese and curd actually declined at the rate of 2.5% per annum during the same period (see Table 12).

Trends in prices of dairy products

2.32 International prices for dairy products can be viewed as the composite of f.o.b8 prices of the dairy products in the major exporting countries, such as the countries of the European Economic Community (EEC), New Zealand and the United States of America. As far as individual dairy importing countries are concerned, the prices at which they obtain their imports of dairy products must include the cost of insurance and freight (c.i.f.) over and above the f.o.b. prices. Hence the c.i.f. prices will differ between importing countries.

8 f.o.b. = free on board; f.o.b. prices refer to prices payable at the port from which shipments of exports are made.

2.33 Farm price-support programmes for dairy production in Western Europe (mainly in the EEC) and North America (mainly United States of America) are blamed for the problems that characterize the world market for dairy products. Price support programmes have led to over-production of dairy products in these developed market economies so that not all of such products can be disposed of through the normal commercial outlets. These developed countries, being the major dairy producers, have contributed to the depression of international dairy prices through two main mechanisms:

(i) the lack of sufficient commercial outlets in developed countries has led to a stockpiling of dairy products, primarily in the form of dried skimmed milk and butteroil; and

(ii) these countries have often offered for sale on the world market their stockpiles of dairy products at concessional rates or, in more crude terms, they have dumped their dairy products into the world market.

The stockpiles of dairy products in developed countries reached record levels in the mid-1970s, and the 1970s were generally years of depressed international prices in dairy trade, except for two relatively short periods during the first half of the 1970s (FAO, 1978). At current prices only about 20% of the increased value of dairy imports into sub-Saharan Africa over the last two decades can be attributed to dairy price increases (von Massow, 1984 (a)), and there is no doubt that the rate of global inflation over the last two decades has been such that it must have caused the real prices of dairy products in world markets to decline during that period.

2.34 The stockpiling of dairy products in the developed countries of Western Europe (mainly EEC) and North America (United States) and its contribution to the depression of international dairy trade and prices has not changed much in the early 1980s. According to the FAO Food Outlook (Vol. 1) 1984, the world production of dairy products in 1983 was estimated to be 3% higher than the 1982 production level. The FAO blames increases in the world's stocks of dairy products on weak internal and external demand in the face of higher production levels in the EEC and the US during the 1983 and notes that such stockpiles of dairy products were responsible for the relatively low export prices for some dairy products during 1983.

2.35 As a net dairy-import region, sub-Saharan Africa would be expected to benefit from the depressed international prices for dairy products. However, a survey of internal dairy product prices in various countries within sub-Saharan Africa reveals that the range of prices in the region is much wider than that which occurs on the world market (ILCA Bulletin No. 4; 1979). Most countries in sub-Saharan Africa have both the formal dairy marketing subsystem (the official channel), which caters primarily "for urban milk supplies, and the informal (traditional and primarily rural) marketing subsystem operating at the same time. The government-controlled (official) prices rule in the formal marketing subsystem while prices obtaining in the traditional marketing subsystem generally characterize a "free marketing system" and usually tend to be much higher than the official producer prices.

2.36 With most countries in sub-Saharan Africa being net importers of dairy products, and with both the formal and informal marketing subsystems operating at the same time in each country, one can conceptualize the existence of three different prices for dairy products in each country: (i) the official producer and consumer prices; (ii) the rural or traditional prices, which often are both producer and consumer prices (because producers will often sell directly to consumers); and (iii) the equivalent of the c.i.f. prices (prices at which imports are secured). Usually, the three different types of prices differ substantially both within and between countries, and the greatest variations are likely to occur in the prices in the traditional rural marketing subsystem.

2.37 Available records suggest that prices in the official (formal) dairy marketing subsystem within a country are relatively more stable. This situation arises out of the concern by governments to keep dairy product prices low in order to ensure that the urban populace can get their requirements cheaply. Even though data that would facilitate a systematic analysis and comparison of the marketing margins and prices in the official (formal) and traditional marketing subsystems is lacking, it appears that the traditional market prices are relatively more unstable and that they usually are above the official market prices. There is also some evidence that the differences between the official and traditional market prices can be very large at times (especially owing to seasonality of agricultural production).

2.38 A survey of dairy prices by ILCA suggests that the differences between the official and traditional market prices can fluctuate between parity and triple the official price in certain areas of West Africa, especially in Ghana and Nigeria, while they could be from 50% to 100% higher than the official prices in Sudan, Mali and Tanzania. A comparison of local and world market prices for dairy products also suggests that there is greater variability in local market prices and that the local prices can be as high as two to three times the world market prices. FAO (1978) reckons that market prices for milk (and other dairy products) have increased much faster in sub-Saharan Africa than in the world market during the late 1960s and the 1970s. Hence the difference between domestic (sub-Saharan Africa) and world milk prices should be expected to have increased during the 1970s (see also ILCA Bulletin No. 4; 1979).

2.39 Even though there is a lack of sufficient market data which would facilitate a systematic appraisal of differences in prices and trading margins between the official and traditional marketing subsystems in sub-Saharan Africa, it appears that many African governments have been slow in responding to the changes in internal dairy production cost structures. Such changes would have required regular revision of the official prices in order to reflect the levels of the prices in the informal or traditional markets. The hypothesis in this line of argument is that the traditional market prices are more competitive and that they reflect the actual market conditions. These prices should thus contribute to the decision-making process if the development of the dairy industries in sub-Saharan Africa is to be accelerated.

2.40 Given the scarcity and limitations of the available data on the operation and performance of both the official and traditional dairy marketing subsystems, efforts should be made to carry out country-specific case studies in order to generate data that can be used to appraise the performance of the official and parallel (traditional) markets. This brief review has identified the possibility of the existence of three different types of dairy prices at any one time: (i) the traditional market prices, which often are the highest; (ii) the relatively stable official channel prices; and (iii) the c.i.f. (world market or import) prices, which often are the lowest. There is no doubt that the governments of sub-Saharan Africa countries are now faced by relatively low c.i.f. prices for dairy products, and the temptation to import cheap dairy products (especially milk powder and butteroil) rather than to intensify local production of dairy products in order to satisfy local demand for these products is quite large. The existence of big differences between the prices prevailing in the official marketing channels and those in the traditional marketing channels, and also between the prices in the domestic market and those in the world market,9 reflects distortions in the marketing system. Such price differentials imply that either the consumers or the producers are being- subsidized or taxed (penalized) by the official marketing and pricing policies. More equitable policies would thus be warranted. However, not much is known about the impact of such price differentials and the importation of cheap dairy products on the development of the local dairy industry in different countries of sub-Saharan Africa, even though some recent work in Mali has revealed a negative impact (von Massow, 1984 (b)).

9 After duly accounting for the local marketing costs in order to bring domestic and world market prices at comparable levels.

Trends in consumption

2.41 Fast population growth, an increasing degree of urbanisation and rising per caput incomes in sub-Saharan Africa have generally led to a situation whereby effective demand for dairy products in the region has outstripped the local production of these products. This situation has made it necessary to make massive imports of dairy products into sub-Saharan Africa in order to satisfy demand in the region - see the previous subsection on "trends in trade" for a fuller discussion of this aspect of trade.

2.42 A survey by Paulino and Young (1981) suggests that the per caput consumption of milk from goats, sheep and camels in Eastern Africa generally declined while the total consumption of cow's milk in sub-Saharan Africa, especially in the Western Africa subregion (Nigeria in particular), generally increased during the last two decades. The data presented in Tables 4 and 9 appear to support these general observations with regard to cow, sheep and goat milk. Paulino and Yeung (1981) further suggest that about 90% of the total amount of milk and milk products that arc either produced in or imported into sub-Saharan Africa are utilized for food purposes. If this figure is taken as a reasonable approximation of the utilization patterns of dairy products in sub-Saharan Africa, then one could hypothesize that any acute shortages of dairy products in this region could adversely affect the nutrition of the people in the region.

2.43 Table 13 gives a breakdown of the developments in the total consumption -of the major traded dairy products in sub-Saharan Africa between 1970 and 1980. The data presented in the table indicate that the total consumption of fresh milk in the region grew at relatively moderate rates (between 1.0% and 1.9% per annum) between 1970 and 1980 in all the subregions of the sub-Saharan Africa, which recorded an average growth rate of 1.4% per annum for fresh milk consumption during that 10-year period. Total consumption of fresh liquid milk actually grew fastest in Central Africa and experienced the lowest growth rate in Southern Africa, with Eastern Africa and Western Africa each recording an average growth rate of 1.4% per annum. Total consumption of dry milk (inclusive of dry skim milk and buttermilk and dry whole cow milk) actually recorded the highest increase during the 10-year period. The subregional range for the growth rates in total consumption of dry milk was from 7.9% per annum (for Southern Africa) to 15.996 per annum (for Eastern Africa) during the 10-year period, resulting in an average rate of growth for the sub-Saharan Africa of 13.5% per annum. In 1970, the total consumption of dry milk in the region constituted only about 5.8% of total consumption of dairy products in terms of whole milk equivalents (WME), but the share of dry milk consumption (in WME) in the regional total consumption of dairy products (in WME) had risen to about 15.496 by 1980 (calculations based on the conversion factors described under Table 14). Further analysis of consumption will be based on the data presented in Table 13 after converting them into whole milk equivalents.

Table 13 Total Consumptiona of Dairy Productsb in Sub-Saharan Africa by Subregions and Type of Product in 1970 and 1980 (Quantities in 1000 Metric Tons)

SUBREGION/COUNTRY GROUPING (No. of Countries)/PRODUCT

TOTAL CONSUMPTION

% ANNUAL GROWTH RATE (1970-1980)

1970

1980

1. EASTERN AFRICA (9):





(i) Fresh/Liquid Milk

4,172.7

4,785.7

1.4


(ii) Dry Milk

12.5

53.3

15.9


(iii) Evaporated & Condensed Milk

9.2

10.4

1.2


(iv) Cheese & Curd

43.7

59.8

3.2


(v) Butter & Ghee

30.4

34.0

1.1

2. CENTRAL AFRICA (8):





(i) Fresh/Liquid Milk

253.7

305.3

1.9


(ii) Dry Milk

7.3

26.0

13.5


(iii) Evaporated & Condensed Milk

8.2

17.8

8.1


(iv) Cheese & Curd

20.2

4.4

- 14.1


(v) Butter & Ghee

2.6

3.9

4.1

3. WESTERN AFRICA (16):





(i) Fresh/Liquid Milk

1,334.2

1,537.5

1.4


(ii) Dry Milk

27. 6

105.1

14.3


(iii) Evaporated & Condensed Milk

82.2

238.9

11.3


(iv) Cheese &. Curd

17.1

17.7

0.3


(v) Butter & Ghee

24.5

41.4

5.4

4. SOUTHERN AFRICA (11):





(i) Fresh/Liquid Milk

604.0

665.1

1.0


(ii) Dry Milk

12.1

25.8

7.9


(iii) Evaporated & Condensed Milk

23.7

4.3

- 15.7


(iv) Cheese & Curd

9.0

8.0

-1.2


(v) Butter & Ghee

7.9

10.2

2.6

** SUB-SAHARAN AFRICA (44):





(i) Fresh/Liquid Milk

6,364.7

7,293.5

1.4


(ii) Dry Milk

59.5

210.2

13.5


(iii) Evaporated &. Condensed Milk

123.3

270.3

8.2


(iv) Cheese & Curd

90.0

90.0

0


(v) Butter & Ghee

65.3

89.6

3.2

a Derived as Sum of Production and Imports LESS Exports.

b Excludes CAMEL Milk and Milk Products.

SOURCE: Calculations by the Author, based on Statistics from FAO Production Yearbooks and FAO Trade Yearbooks (1973 and 1981), and which are presented as Appendix Table A.5.

2.44 The growth in total dry milk consumption reflects the massive imports of dry skim milk into sub-Saharan Africa which have been made during the 1970s in order to satisfy the growing demand for milk in the region. Such dry skim milk has normally been recombined with appropriate amounts of imported butteroil in order to produce liquid milk, primarily for the liquid milk urban markets. Hence the total consumption of butter and ghee (which includes the consumption of the imported butteroil) has also experienced significant growth during the 1970s for most subregions in the sub-Saharan Africa. However, total consumption of cheese and curd has been on the decline, with Eastern Africa being the only subregion where significant consumption growth occurred, and with close-to-zero growth rate in Western Africa and negative growth rates in Central and Southern Africa subregions. Consequently, cheese and curd consumption recorded an overall zero growth rate for the sub-Saharan Africa region during the 1970-1980 period.

2.45 Consumption is derived as the sum of production and net imports (where net imports simply refer to imports less exports) in a situation where there are no carry-over stocks (as is the case for sub-Saharan Africa as far as dairy products are concerned). Therefore, a discussion of trends in consumption of dairy products in sub-Saharan Africa can be summarized by examining trends in production and net trade position, on a subregional and regional basis, both in total and per caput level basis. Table 14 gives the 1970 and 1980 human population data for sub-Saharan Africa and then presents the developments in both total and per caput dairy production, net trade (net imports in this case) and consumption by subregions during the 1970-1980 period.

2.45 The average per caput consumption of dairy products in whole milk equivalents (WME) in sub-Saharan Africa as a whole appears to have remained relatively stable (close to about 30 kg per head per annum) during the 1970s (Table 14). However, the data presented in Table 14 indicate that there have been variations and changes in the levels of per caput consumption of dairy products in different subregions during that period. Those changes were as follows:

(i) 8.8% decrease for Eastern Africa;
(ii) 11.6% decrease for Southern Africa;
(iii) 13.1% increase for Central Africa: and
(iv) 17.2% increase for Western Africa.

Table 14 - Human Population and Production, Net Imports and Consumptiona of All Dairy Products in Whole Milk Equivalents (WME) for Sub-Saharan Africa by Subregions in 1970 and 1980 (mT = Metric Tons)

REGION/SUBREGION PARAMETERS

HUMAN POPULATION (1000 People)

PRODUCTION

NET IMPORTS

CONSUMPTION

Total

Per Caput

Total

Per Caput

Total

Per Caput

1. EASTERN AFRICA:


(1000 mT)

(kg)

(1000 mT)

(kg)

(1000 mT)

(kg)


1970

77,119

4,557.2

59.1

90.7

1.2

4,647.9

60.3


1980

102,745

5,202.3

50.6

449.0

4.4

5,651.3

55.0

2. CENTRAL AFRICA:









1970

44,620

318.1

7.1

91.0

2.0

409.1

9.1


1980

57,230

318.8

5.6

261.9

4.6

580.7

10.2

3. SOUTHERN AFRICA:









1970

33,149

664.5

20.0

165.1

5.0

829.6

25.0


1980

43.737

692.5

15.8

277.1

6.3

969.6

22.1

4. WESTERN AFRICA:









1970

107,847

1,541.1

14.3

400.5

3.7

1,941.6

18.0


1980

145,497

1,771.2

12.2

1,402.1

9.6

3,173.3

21.8

** TOTALS FOR SUB- SAHARAN AFRICA:









1970

262,735

7,080.9

27.0

747.4

2.8

7,828.3

29.8


1980

349,209

7,984.7

22.9

2,388.4

6.8

10,373.1

29.7

a Consumption is derived as sum of Production and Net Imports (where Net Imports = [Imports - Exports]).

b Includes Fresh Milk, Dry Milk, Evaporated and Condensed Milk, Cheese and Curd, and Butter and Ghee. All expressed in Whole Milk Equivalents (WME). The figures are based on aggregates of cow, sheep and goat milk and milk products (i.e. camel milk and milk products are excluded).

c Milk products were converted into WME using the following "average" conversion factors: 7.6 for dry milk, 2.0 for evaporated and condensed milk, 3.2 for cheese and curd, 7.3 for butter and ghee, and, of course, 1.0 for fresh milk. These "average" conversion factors were derived from the standard conversion factors which are presented in App. Table A.7 of this paper.

SOURCE: Calculations by author, based on Statistical Data from FAO Production and Trade Yearbooks, 1973 and 1981. Also see the basic Statistical Data in Table 13 and Appendix Table A.5.

Table 14 further indicates that of the four subregions in sub-Saharan Africa; Eastern Africa has the highest per caput consumption of milk and milk products, followed by Southern Africa. The share of per caput net imports in per caput consumption is also lowest for Eastern Africa. Table 15 illustrates the developments in the share of per caput net imports in per caput consumption of dairy products in sub-Saharan Africa during 1970s.

Table 15 - Share of per caput net imports in per caput consumption of dairy productsa in Sub-Saharan Africa by subregions, 1970 and 1980

Region/Subregion

Per Caput

Per Caput

% Share of Net

Net Imports

Consumption

Imports in Consumption

(kg)

(kg)

1. Eastern Africa: 1970

1.2

60.3

2.0


1980

4.4

55.0

8.0

2. Central Africa: 1970

2.0

9.1

22.0


1980

4.6

10.2

45.1

3. Southern Africa: 1970

5.0

25.0

20.0


1980

6.3

22.1

28.5

4. Western Africa: 1970

3.7

18.0

20.6


1980

9.6

21.8

44.0

Averages for Sub-Saharan 1970

2.8

29.8

9.4

Africa: 1980

6.8

29.7

22.9

a Aggregates of cow, sheep and goat milk and milk products in whole milk equivalents.

SOURCE: As for Table 14.

2.46 Central Africa, which has the lowest level of per caput consumption of dairy products, has the highest share of net imports in consumption. Generally, all four subregions of sub-Saharan Africa have experienced increases in the share of net imports in consumption during the 1970s.

2.47 As suggested elsewhere, increased consumption of dairy products in sub-Saharan Africa is partly attributable to increased demand for these products due to rapid population growth. Table 16 indicates the rates of growth in human population and in both total and per caput production, net imports and consumption of dairy products (expressed in whole milk equivalents, WME) in sub-Saharan Africa during the 1970s.

Table 16 - Rates of Growth in Human Population, and Production, Net Imports and Consumption of Dairy Products (in WME) in Sub-Saharan Africa by Subregions, 1970-1980

REGION/SUBREGION

ANNUAL % RATES OF GROWTH, 1970-1980

(No. of Countries Included)

Human Population

Production

Net Imports

Consumption

Total

per Caput

Total

per Caput

Total

per Caput

(% p.a.)

(% p.a.)

(% p.a.)

(% p.a.)

1. Eastern Africa (9)

2.9

1.3

-1.5

17.3

13.9

2.0

-0.9

2. Central Africa (8)

2.5

0.0

-2.3

11.1

8.7

3.0

-1.1

3. Southern Africa (11)

2.8

0.4

- 2.3

5.3

2.3

1.6

-1.2

4. Western Africa (16)

3.0

1.4

-1.6

13.3

10.0

5.0

1.9

Averages for sub-Saharan








Africa (44)

2.9

1.4

-1.6

12.3

9.3

2.9

0.0

SOURCE: Calculations based on data in Table 14.

2.48 The data presented in Table 16 indicate that population in sub-Saharan Africa grew at the rate of 2.9% p.a. during the 1970s, while total dairy production and consumption grew at the rates of 1.4% p.a. and 2.9% p.a. respectively. Hence per caput production declined while net imports (both total and per caput levels) increased throughout all four subregions of sub-Saharan Africa during the same period. Per caput consumption of dairy products generally declined in Eastern and Southern Africa and increased in Central and Western Africa during the same period. The overall per caput consumption level for dairy products in sub-Saharan Africa remained more or less constant during the 1970s.

2.49 Conceptually, one would expect that there will be some urban/rural differences in per caput consumption of imported dairy products, depending on the proportion of dairy imports which is destined for consumption in urban areas. Generally speaking, one can assume that the socio-economic and infrastructural factors in most countries in sub-Saharan Africa are such that most of the dairy imports are consumed within urban areas. However, urban population constitutes only a small proportion of the total population in most countries in sub-Saharan Africa. If one is interested in deriving the differences between urban and rural per caput-consumption of an imported commodity, both the proportion of the imported item that is retained for consumption in urban areas and the proportion of the total population that lives in urban areas should be taken into account. The following general formula is applicable when deriving statistics to indicate rural/urban per caput consumption differences:

(1) PCRC = [pc.M]/[pr.N]

and

(2) PCUC = [(1-pc).M]/[(1-pr). N]

Where:

(i) PCRC and PCUC are the respective per caput rural and urban consumption levels;

(ii) pc = proportion of imported item that is destined for consumption in rural areas;

(iii) pr = proportion of the total population that lives in rural areas;

and

(iv) N and M are the total population and the total amount of the imported item respectively.

2.50 Recorded trade statistics normally relate to volumes and values of total imports and exports. Therefore, M has to be derived from such statistics when one wishes to apply the above formula. Little is known about the exact amounts or proportions of imported commodities in any country in sub-Saharan Africa that are consumed in urban areas. However, as a provisional working assumption, we guesstimate that 80% of such imported commodities will be consumed in urban areas, given the infrastructural and socio-economic conditions that prevail in most countries in the region. Therefore, a value of 0.20 for pc will be used in the calculations of urban and rural per caput consumption of imported dairy products in the region. Based on some statistics for 1980 on the degree of urbanisation (i.e. percentage of population that lives in urban areas in some individual countries of sub-Saharan Africa, one can deduce the following crude average figures for the degree of urbanisation in different subregions of sub-Saharan Africa (Table 17 (a)):

Table 17 (a) Degree of Urbanisation in Different Subregions of Sub-Saharan Africa, 1980

Subregiona

% of Population that is Urban

(=(1-pr)in the formula presented above)

1.Eastern Africa

18

2.Central Africa

31

3.Southern Africa

20

4.Western Africa

24

**Average for sub-Saharan Africa

23

a The percentage of population that is urban in the individual countries for which statistics are available can be found on pages 260 and 261 of the World Development Report 1984. Actual subregional averages for the degree of urbanisation are crude in the sense that they are not weighted to reflect populations in individual countries.

SOURCE: Calculations by the author, based on the statistics quoted in a above.

Given the data which are presented in Table 17(a) the values of 0.82, 0.69, 0.80, 0.76, and 0.77 will be substituted for pr in the calculations of rural and urban per caput consumption of imported dairy products in Eastern, Central, Southern, Western, and sub-Saharan Africa respectively. Table 17(b) attempts to illustrate variations in the levels of per caput consumption of imported dairy products between rural and urban areas of different subregions in sub-Saharan Africa. The data presented in Table 17(b) suggest that Western Africa subregion had the highest levels of both rural and urban per caput consumption of imported dairy products during the 1980 period.

Table 17(b) - Guesstimated Urban/Rural Differences in per caput Consumption of Net Dairy Importsa for Sub-Saharan Africa by Subregions during 1980 (Consumption in kg per Head of Population)

REGION/SUBREGION

PER CAPUT CONSUMPTION OF NET DAIRY IMPORTSa

(Magnitudes pr, pc)

URBAN

RURAL

1980

1980

(kg)

(kg)

1. Eastern Africa (0.82, 0.20)

19.42

1.07

2. Central Africa (0.69, 0.20)

11.81

1.33

3. Southern Africa (0.80, 0.20)

25.34

1.58

4. Western Africa (0.76, 0.20)

32.12

2.54

** AVERAGE FOR SUB-SAHARAN AFRICA (0.77, 0.20)

23.79

1.78

a Aggregates of cow, sheep and goat milk and milk products, expressed in whole milk equivalents.

SOURCE: Calculations based on data in Tables 14 and 17(a) and under the assumptions and procedures given in paragraph 2.50.

2.51 A comparison of the per caput consumption of net dairy imports by region and subregion as presented in Tables 14 and 17(b) suggests that there may be large variations in the levels of rural and urban per caput consumption of imported dairy products and that these levels may be quite different from the average national, subregional or regional per caput consumption of the imported dairy products. The data presented in Table 17(b) further suggest that the ratio of rural to urban per caput consumption of net dairy imports in sub-Saharan Africa is around 0.07, this result being an outcome of the assumptions made above.

2.52 Milk consumption appears to be characterized by a relatively low income elasticity of demand, which is positive in most developing countries but usually negative in developed countries. For developing countries, the values of income elasticity of demand appear to lie somewhere between zero and one, even though one may expect large variations between countries, depending on the differences in levels of disposable per caput income. The income elasticity of demand for milk in sub-Saharan Africa is estimated to be about 0.8, based on a 1975-2000 projection (see Table 18). The subregional variability of income elasticities of demand for milk typically ranges from 0.53 (for the Sahel group of countries in Western Africa) to 1.09 (for Central African countries). The breakdown of these variations is given in Table 18. The data presented in Tables 18 indicate that income elasticities of demand for milk in most sub-Saharan African countries are positive and close to one. Therefore, one can expect effective demand for milk in the region to continue to increase as the individual countries in the region make progress toward higher levels of economic growth.

2.53 The preceding analyses and review generally indicate that total consumption of dairy products in sub-Saharan Africa has been increasing over the last two decades, per caput consumption has been stable, and per caput production has been declining (Tables 14 and 16). When the amounts of milk and milk products were expressed in terms of whole milk equivalents (WME), it was observed that the overall rate of growth in the consumption of dairy products in sub-Saharan Africa has been of the order of 2.9% during the 1970s, while the corresponding overall rate of growth in the production of dairy products in the region has been of the order of about 1.4% p.a. during the same period (Table 16). This trend in the growth of the sub-Saharan Africa dairy industry may be expected to persist in the future, i.e. consumption will continue to grow much faster than production. Paulino and Yeung (1981) have estimated that the demand for dairy products by the year 2000 in sub-Saharan Africa would be about 8.3 million tons of whole milk equivalents and that this would exceed the projected level of regional dairy production in year 2000 by about 60%. This state of affairs is of immediate concern for development planning and related programmes.

Table 18 - Variability In Income Elasticities of Demand for Milk in Sub-Saharan Africa, by Subregions & Selected Countries, based on Projections for the 1975-2000 Period

REGION/COUNTRY

VALUE(IED*)

WESTERN AFRICA



Sahel

0.53


Nigeria

1.20


Rest

1.23

CENTRAL AFRICA

1.09

EASTERN AFRICA

0.90


Sudan

0.77

SOUTHERN AFRICA

0.95

SUB-SAHARAN AFRICA**

0.82

* IED = Income Elasticity of Demand for Milk.

** Based on estimates for Tropical African Countries (i.e. excludes the tiny Indian and Pacific Ocean islands).

SOURCE: Adapted from Jahnke (1982), p. 48.


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