Reducing Postharvest Losses
In the OIC Member Countries
45
The milk and dairy value chains in OIC countries
Milk and dairy products are a vital source of nutrition for billions of people worldwide, and
also provide livelihoods opportunities for farmers, processors, traders, and other stakeholders
in the value chain (FAO, 2013).
According to FAO Statistics, whole fresh cow milk is the principal product produced by the
dairy industries in OIC countries. Only in a few exceptions are buffalo milk (Pakistan, Brunei
Darussalam), camel milk (Somalia), or goats milk (Bangladesh, Oman, UAE) the principal
products. In the case of Malaysia, whole condensed milk is the principal product. As for the
second and third most important dairy products, fresh goat and sheep milk are the main
products, followed by dairy products such as butter from cow’s milk.
According to FAOSTAT (quoted in COMCEC, 2015, Page 41), fresh cow milk is the second most
important agricultural and livestock product produced in OIC Member Countries (after paddy
rice, and before yams, wheat, chicken meat, and palm oil). Its total production value for the
2004 – 2006 period is indicated as roughly USD 22 billion per annum.
The bulk of the milk produced in the majority of OIC countries is produced by smallholder
farmers owning less than 10 cows. For example, in Egypt family farms with 1 - 8 cattle
constitute the majority of dairy farmers and are estimated to be responsible for about 80% of
the milk produced (Al-Amaiem, 2014, in COMCEC 2015). Most of the milk produced (about
85%) is marketed as raw milk (e.g. sold loosely on the street or through vendors that go from
door to door), or processed into home-made butter and cheese and sold in small shops (Oxford
Business Group, 2012b, in COMCEC 2015). Figures in other countries are similar. For example,
in Uganda 75% of all milk sold originates from the smallholder sector with women playing an
important role in household milk production, processing and marketing.
Only about 10% to 25% of the milk produced is processed by the modern sector. For example,
in Egypt only about 10% to 15%t of the milk produced is processed by the modern commercial
sector due to the dominance of the informal milk sector, the lack of contract farming and weak
relationships between producers and processors (El Lateif Aita et al., 2012, in COMCEC 2015).
Although most of the modern factories use fresh milk as main input for processing, companies
often also import milk powder to increase processing activities and make use of their
capacities.
Particularly smallholder farmers in rural areas rely on middlemen to collect and market their
milk through informal channels, as they do not have access to formal marketing channels. The
involvement of middlemen is considered to reduce prices for farmers, as gains are not passed
onto farmers. At the same time, in many cases middlemen provide access to support services,
such as credit and health care, in order to strengthen their position within the value chain (El-
Amaiem, 2014; in COMCEC 2015).
Overview of postharvest loss figures found in the literature for the milk and dairy value
chains in selected countries;
According to Lipinski et al (2013), 18% of milk was lost or wasted (in 2009, percent of kcal). In
terms of loss and waste by weight, milk constitutes 8% of total food lost and wasted, whilst it is
4% of loss and waste in Kcal. An overview and tally of key informants is given in Table 12.