PHD-Department of Agribusiness Management and Trade (AMT)

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Browsing PHD-Department of Agribusiness Management and Trade (AMT) by Author "Kimenchu, Mugambi David"

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    Evaluation of milk production efficiency Of dairy farms in Embu and Meru counties, Kenya
    (2014-09-09) Kimenchu, Mugambi David
    Despite Kenya's long dairy farming history spanning about 100 years, favourable climatic conditions and a 3.5 million national herd, milk per capita consumption is low (76.7 kg) and export quantities (milk) to the regional market where its products enjoy preferential access are negligible. These observations raised the question of farm level milk production efficiencies. This study evaluated milk production efficiency of dairy cow farms in Embu and Meru counties of Kenya, using the stochastic frontier approach. Data were randomly collected from 135 dairy farms and were supplemented with information from other dairy industry stakeholders. The sample size was detennined using the Cochran's (1977) formula. Data were analyzed using the SPSS, Frontier 4.1 c and STATA computer softwares, where both descriptive and inferential statistics were derived. Stochastic frontier production and cost functions were estimated using the maximum likelihood estimation technique. The farms were characterized and both technical and cost efficiencies estimated. Each of the efficiencies was then related to milk production cost to establish the cost reduction potential. Results revealed that the number of lactating cows and the amounts of roughages, concentrates, and mineral supplements were the major factors influencing milk output, while the prices of roughages and labour were the major factors associated with the total production costs. The dairy animals received inadequate feeds and mineral supplements. The animals were overstocked and underfed in an average twoacre mixed crop-livestock farm. The mean farm technical and cost efficiencies were 83.7 and 95.6%, respectively, and therefore inefficient. These results implied that milk production could be increased by 16.3% through better use . of available resources given the current state of technology without extra cost, while its cost could be decreased by about 4.4% without decreasing output. The milk production model coefficient was 2.11. It was shown that roughage and labour could substitute for one another to reduce dairy farming costs. Optimization of farm efficiencies and taking advantage of economies of scale through increased production inputs could be part of short-term measures to address the challenges facing smallholder dairy fanning. It was recommended that farmers specialize in either dairy or crop farming. Those choosing dairying, require shifting from the Friesians and Ayrshires to the smaller dairy breeds such as Jerseys, for they require less feed quantities in milk production. The researchers require identifying the least-cost combination ratio for roughages and labour inputs. The policy makers should provide legal guidelines to ensure that sub-division of agricultural land is minimized and further, promote both enterprise specialization and approaches that make the farm inputs such as concentrates and mineral supplements affordable.