Busienss Reporter
GOVERNMENT is targeting growth of 7 percent in the dairy sector over the next five years to be financed from proceeds of the levy on pasteurised milk imports.
The Ministry of Macro-economic Planning and Investment Promotion said in its 2015 fourth quarter macro-economic bulletin, the levy will help grow the commercial dairy head.
“The levy will support increase in the number of cows for milking as well as reduce costs of production,” the ministry said. The commercial head stands at about 32 000.
About 28 000 commercial dairy cows are lactating and producing about 56 million litres of milk annually against national requirement of about 120 million.
“The country requires about 120 million litres of milk per year and the formal sector supplies 56 million litres per year,” the ministry said in its bulletin.
Milk production figures for August 2015 showed a steady increase of 4 percent over July. Year-on-year milk production grew by 3,4 percent last year.
According to the bulletin, there was investment in the refurbishment of sterilised milk plant in June 2015. The investment will see the local demand that stands at 1,5 million per month being satisfied and also contribute to exports.
Agriculture, Mechanisation and Irrigation Development chief dairy officer Tendai Marecha recently told a dairy farmers association annual meeting that milk production in the country had risen 11 percent to 4,6 million per month.
The growth in milk production, Mr Marecha said, was attributable to increased number of farmers in the dairy industry and continuous training of farmers.
Meanwhile, Government says there is potential to grow the national herd to 6,3 million from the current 5,4 million with 92 percent owned by small farmers.
“There is potential for the national herd to grow to at least 6,3 million, as recorded in 1991, which is the highest level achieved to date,” the ministry said.
Beef prices have in the recent past been falling, but prices recovered significantly due to a reduction in the number of animals available for slaughter.
Live cattle prices as at the end of September ranged from $1,67 per kilogramme for weaner steers to $1,84 per kg for feeder steers. This contrasts sharply with the prices for feeder steers in September 2014 of $1,93/kg.
After peaking in July, total cattle slaughters declined in August. Cattle slaughters for the last eight months of 2015 were dominated by commercial and economy grades being delivered to abattoirs while super and choice grades accounted for less than a quarter of slaughters during the period in review.