Smallholder dairy development:
Lessons learned in Asia




Bangkok, January 2009

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ISBN 978-92-5-106187-9

© FAO 2008



Edited by Nancy Morgan, Livestock Policy Officer, Regional Office, Bangkok


Acknowledgement: The dairy development workshops, country studies and publication of the workshop proceedings were funded by the Common Fund for Commodities, the Animal Production and Health Commission for Asia and the Pacific as well as the FAO regional office in Bangkok.

For copies, please contact:

Senior Animal Production and Health Officer
and Secretary of APHCA
FAO Regional Office for Asia and the Pacific (RAP)
39 Maliwan Mansion, Phra Atit Road
Bangkok 10200, THAILAND

E-mail :
[email protected]
FAO Homepage : http://www.fao.org
APHCA Homepage : http://www.aphca.org


Table of Contents


Introduction: Dairy development in Asia

   Production grows faster than in any other region

   Opportunities for import substitution

   The region´┐Żs challenge: How to ensure local participation in the growing demand for milk products

Bangladesh: Social gains from dairy development


   The history of the sector

   Recent developments

   Smallholder milk producers and marketing models

   Conclusions and prospects

China: Dairy product quality as the new industry driver

   Dairy development in China

   Dairy production in Chinese farm households

   The economics of dairy production

   Policies promoting dairy development

   Models linking smallholder dairy cow farmers and the market

   Challenges for the smallholder dairying households


India: Increasing demand challenges the dairy sector

   Emerging situation

   Factors affecting the competitiveness of the dairy sector

   Industry SWOT analysis

   Four dairy enterprise models

   Comparative analysis of the four value chains



Mongolia: Rebuilding the dairy industry


   The current dairy situation: An overview

   Small-scale dairy farmers


   Conclusions and lessons learned

Pakistan: A dairy sector at a crossroads

   Overview of the milk economy

   National dairy strategy: Issues and opportunities

Sri Lanka: Opportunities for dairy sector growth


   Sector review

   Smallholder dairy farmers

   Key constraints to development


Philippines: Promoting dairy entrepreneurship through enterprise zones


   Industry overview

   Important trends contributing to dairy development

   Critical factors influencing dairy development

   Smallholder dairy farmers



Thailand: An industry shaped by government support


   More recent programmes supporting dairy development

   The current dairy situation


Viet Nam: The emergence of a rapidly growing industry


   Trade policy in the context of WTO integration

   Recent trends and expected future developments in the dairy sector

   Smallholder farmers move into dairy production


Models and opportunities for smallholder dairy producers in Asia: lessons learned

   Identifying the lessons

   Models that link smallholders to formal markets

   Factors affecting model selection and overall dairy development

Dairy policies and sector planning

   Implementing an effective dairy development planning process

   Policy objectives, the mechanisms for implementation and their impact

   Examples from developed countries: Achieving dairy policy objectives

   Evaluating dairy policy objectives and possible responses in developing countries