Chapters two and three have given us insights into how to form and develop a milk producer group. In chapter four we started describing group activities with more information on milk collection, processing and marketing. In this chapter we continue describing other possible group activities: input supply (5.1), financial (5.2), information and advice services (5.3), animal breeding (5.4), animal health (5.5) and other possible activities (5.6). Participatory tools are dealt with in chapter six.
Reducing the cost of milk production is an important way of increasing the income of milk producers. The bulk purchase of inputs can reduce the cost considerably. Some inputs that could be purchased through the group are:
animal feed (concentrates, etc)
veterinary drugs and medicines
farm equipment like barbed wire, etc.
cleaning agents (to be used at farm level)
standard milk cans.
Confidence will be built in the group if all members are participating in purchasing inputs. It creates an atmosphere of cooperation, which has social and economic advantages. Sharing experiences will be easier and members are more likely to use other services offered by the group. Individual supplies of inputs can be subtracted from the milk bill or purchased on credit. More information is given below, as an example on the provision of animal feed.
The cost for animal feed can be as much as 70% of the cost of milk production and the lack of good quality feed is often a major constraint on milk production. This is an area where the milk producer group can assist members, but remember that feed can be costly. Feeding programmes should be based on optimum rather than maximum yields. The group can provide low cost balanced feeds together with technical information on the use of feed. These feeds can be:
balanced concentrate feed for calf rearing and milk production;
suitable varieties of forage and legumes for the climate;
supplementary feed like molasses, urea, mineral blocks, molasses-urea -blocks.
Many milk producer groups also set up feed mills, purchase grains from suppliers, and sell concentrates to members.
The focus in this section will be on savings rather than credit, because it is better for the sustainability of the group to build up their own funds first. With regular milk payments, it is relatively easy to build up some savings by deducting a certain amount of the milk price (see also cost of dairy support services,). Below you will find an introduction to informal saving activities, an informal loan system within the group, group credit with formal financial institutions, and a group insurance scheme. The conditions for all forms of savings, credit and insurance must be specified in the constitution of the group (see section 2.1: forming groups step by step).
Group saving should be the starting point for group development. Savings (as compared to outside credit) promote the long-term group sustainability, because group savings:
increase resources for potential group or individual activities;
reduce dependency on outsiders;
serve as a form of insurance against risk;
improve a sense of group ownership;
promote group repayment discipline;
facilitate access to outside loans (banks are more willing to give loans to groups that save);
can lower the costs of banking;
can be used to give bigger loans to members of the group;
can be used as emergency loans to members in times of need.
There are many ways to save. Here are some options for groups:
1. Cash contributions: Every member brings to a group meeting an equal amount of cash that is added to the group savings fund. Milk producer groups can deduct a certain amount of money from their milk payments into the group saving fund.
2. Saving in-kind: Instead of cash other things are saved, for example grain, and sold by the group.
3. Rotating savings: Everyone brings an equal amount of grain, cash or something else in kind to a meeting that is given to one of the group members who will be able to use the savings for small investments. At a next meeting, another member receives the money or savings in-kind.
lending of group savings
Once the group saving fund becomes large enough, the group may decide to lend part of their funds to individual members to help them meet their short-term emergency credit needs. These loans should be small and should be repaid in a short time, (e.g. in one to two months) so that other members can also use the fund. The criteria for a proposal should be clearly defined and could include for example, a specific minimum training or a 6 month membership period with the group.
credit with formal institutions
The advantages of getting group credit from formal institutions are:
a group can get more credit;
members can assist each other in preparing loan applications;
a group is in a better position to discuss credit with the organization or bank;
the group can provide evidence of profitability of milk production in the area;
Group loans are usually granted with group liability. This means that each member is individually responsible for repaying his or her part of the group loan. If any member fails to repay his or her part, the other group members must repay it. This rule ensures that all group members repay their part of the loan - otherwise, the group will not be able to borrow from the bank again.
You should carefully assess hidden dangers and risks associated with taking loans from certain people: for example, some politicians may lend money to influence voting at election time.
FAO, Livestock insurance in Asia
Insurance programmes could be an important activity of the group, because group members might not be able to afford the risk of losing expensive animals. Milk producer groups in many countries arrange insurance schemes for members through established insurance companies, but it is also possible to start this as a group activity. The insurance policy should be well documented in the constitution. You will need help from outside to make a proper policy; here we will only mention a few important items in relation to insurances.
Before starting an insurance scheme, a proper survey should be carried out to determine the major dangers, diseases, mortality rates, etc. of the dairy cattle. You could charge a certain percentage per year of the cost of each animal. Setting such a percentage is difficult, because the insurance scheme should not be a loss making activity. Somebody independent, like a government veterinarian will have to assess the cost of the animal. This will be based on age, health, lactation and vaccination record, etc. Identification of animals is important in relation to insurance schemes.
A post-mortem examination report, death certificate (issued by a qualified veterinarian or perhaps by two named village officials) and ear tag where applicable, should be a requirement for payment of claims. Special arrangements should be made for death due to diseases against which the animal could have been vaccinated, floods, famine, earthquakes, theft, intentional slaughter, disability and poor productivity. In some cases full repayment may not be appropriate.
Group members who have learned more about the activities in which they are involved will often develop greater confidence and self-esteem. They will carry out the activities better, and this will improve the quality of the group and the products. Giving the right information and advice at the right time is therefore important for the success of the group. Information and advice services, including training courses, video presentations and learning tours, are described below.
Every time you organize training you will have to think through the following questions:
What is the objective of the training course?
What will be the subject of the training in detail?
Who will be attending the training?
Who will give the training?
Where will the training be organized?
In what form is the training going to be organized?
Before starting any training you have to know the group needs for information or skills. It is important to take into account the needs of all the group members. In order to find this out, you could do a SWOT analysis with all group members (see section 6.7).
It is important to think through the objectives of the training. In other words you have to ask yourself the question: what will change after the training? For example an overall objective of any training programme could be: to increase the members potential to participate effectively in the organization and management of the group. A more specific objective could be: to make the participants familiar with simple milk record keeping methods.
Special training can be given to the leaders of the group. Leaders should develop their skills and knowledge to be able to manage the group properly. Since most of the group decisions are made in meetings, special attention can be given to how they are conducted. Many organizations overlook the importance of planning and preparation in the effective use of meetings. Below is a list of possible subjects for training:
TECHNICAL DAIRY TRAINING
1. milk collection (see section 4.1)
2. milk processing (see section 4.3)
hygiene in milk processing;
production of specific products;
3. animal feeding (see section 5.1)
cultivation of appropriate legume and grass seeds;
use of crop residues;
winter feeding (e.g. small-scale silage making);
4. animal breeding (see section 5.4)
5. animal health care (see section 5.5)
6. keeping milk records
2. record keeping (see section 2.3)
3. communication skills
TRAINING FOR LEADERS
1. leadership skills
2. management training
3. how to conduct meetings (see section 2.4)
encouragement of participants;
arriving at decisions;
reporting and follow up;
4. conflict resolution (see section 3.3).
who will be attending the training?
You have to think through carefully who will participate in the training. If most people are illiterate for example, and you want to organize a training for all members on record keeping, you will have to make sure the record keeping methods are suitable for illiterate people. Make sure the training is organized in such a way that women can also attend.
what will be the source of information?
You should first look within the group to see whether there is anybody who is capable of facilitating or providing training. If the group does not have such people, you will have to look at outsider advisors. If you have done a dairy institutional diagram (see section 6.3), this might give you some ideas about which other organizations you could approach. Information sources could be extension agents, other dairy projects, government institutions, books, videos, CDROMs, websites, etc.
in what form is the training going to be organized?
Adults learn best when everybody is actively involved and there is a chance to share experiences with others. There must therefore be an emphasis on a participatory approach to training. You will have to limit formal lectures and organize learning tours or video discussions, for example.
A flip chart is a stand with large sheets of white paper to write on. It is particularly useful to focus the attention of the participants on a specific subject, to note ideas from participants during a brainstorming session (see brainstorming and ranking, section 6.5) or for example to write the agenda of a meeting.
Decide on which video you are going to show: the video should be interesting, relevant to the group, and fun!
Find an appropriate venue. The venue has to be close to the members and have easy access. If there is no electricity, you will need a generator. If you want to show a video during the day, make sure the room can be made dark.
Before you start, try out everything and make sure somebody is capable of solving a problem when something goes wrong.
Arrange the room and the seats: make sure everybody can see the video (dont forget the children and people with poor eyesight) and that everybody is comfortable.
Provide a short introduction on the objectives of the session and the topic of the video. Beforehand explain things that you think might be difficult to understand (alternatively, you can stop the video during a difficult passage and explain).
Ask questions to stimulate the discussion when the video is over. Check with the members what they thought was interesting and what they have learned. You can also ask whether something should be done differently in the future.
You could now proceed with some group work on the topic, or continue with another activity.
Learning tours are activities where group members go and visit a place of interest. It allows informal learning, and facilitates discussion. Members learn most if they see people doing the same things as themselves. Visits could be made to farms, other milk producer groups, dairy enterprises, and markets. Try not only to look for success stories as a lot can be learned from things that went wrong.
select a topic, host institutions and resource persons and visit them;
visit the place beforehand and make sure the hosts are ready to provide the necessary information, that they understand why you are coming and that the group members can actually learn something;
ask the participating members for some kind of contribution. Willingness to share the cost from their own funds or from other sources can be a measure of the members commitment to learn;
select committed members based on clear criteria, and try to get a balanced mix of participants (i.e. leaders/normal members, men/women, young/old, etc.);
make a budget;
make a plan for evaluation and follow-up activities;
brief the participants on the field visits;
arrange logistics and co-ordination;
maintain a flexible schedule, because there will always be changes;
organize discussion sessions, and finalize with action plans;
obtain ideas for improving the tour;
present the lessons learnt to other group members;
make sure there is some money for follow-up activities.
Genetic potential for milk production is very important in dairy animals. Upgrading of the animals is achieved through selection within local breeds, or the introduction of exotic genes mainly through cross breeding based on artificial insemination. It is essential to have appropriate levels of husbandry and health care before introducing high yielding animals. Breed improvement programmes can be based on natural service or on artificial insemination.
Milk producer groups could maintain breeding bulls, and a fee could be charged for every service, which provides additional income for the group. The health status of bulls must be carefully monitored to avoid spread of diseases.
artificial insemination (AI)
The establishment of an artificial insemination service requires the frequent supply of frozen semen straws and liquid nitrogen. For a small milk producer group, the investment in time and money to initiate these facilities themselves often exceeds the capabilities of the group. The group can either join an existing AI service that is carried out by the government or other organizations in the neighbourhood, or find a reliable supply of liquid nitrogen and semen. Training in heat detection is an important factor in the success of AI schemes and this aspect is frequently overlooked. The fee the group charges for the services should at least meet the total cost.
FAO, A manual for the primary animal health care worker
Well-organized animal health care services should be provided for the milk animals on the farm. If this is one of the group activities, it is best to collaborate with the government and other organizations offering animal health care services. A good quality animal health care service avoids losses of valuable dairy animals and provides a sense of security to the milk producers concerning their animals. Ideally, animal health services should include:
organization of regular visits to members for routine and emergency services;
supply of all necessary veterinary drugs;
a central diagnostic laboratory for disease diagnosis;
preventive vaccination of the dairy animals within the area.
A group has easier access to outside veterinary services. If the availability of veterinarians is a problem in the area, you could decide to train some selected group members as village animal health care workers. This can supplement the veterinary services already offered. These training programmes could be very valuable to the milk production in the area, especially in offering simple services such as de-worming and vaccinating. We will not go into detail on such a programme here, but there are some excellent booklets written on this subject (see information sources at the end of the book).
If there is no access to a cheap and good quality veterinary drug supply, the group could decide to offer these services to its members.
Below is a list of other possible activities for the milk producer group:
A group has greater standing than an individual milk producer. The group can try and influence policy and management of a milk factory or government institutions. This will often be on matters like the milk price, the cost of credit or the inadequate provision of services.
When agriculture or other activities require extensive labour, the group can come together and share their labour to assist with these activities.
A group could pay a guard to watch the animals or equipment or share guard duties.
Management of common grazing land;
We are sure there are many other activities that can be carried out in a milk producer group, keep us updated!