Evaluation of milk production efficiency Of dairy farms in Embu and Meru counties, Kenya
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Date
2014-09-09
Authors
Kimenchu, Mugambi David
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Abstract
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.
Description
Department of Agribusiness Management and Trade, 173p. 2014, SF 233 .K4M8
Keywords
Technical and cost efficiency, stochastic frontier, smallholder dairy farming