Milk production systems in Central Uganda: a farm economic analysis

The Ugandan dairy sector is developing rapidly over recent years and is dominated by small-scale farmers owning more than 90 percent of the national cattle population. Due to market forces and higher competition for production factors, milk production systems are intensifying, necessitating proper understanding of the new production tendencies. Three intensive and four extensive production systems were identified and analysed, using TIPI-CAL (Technology Impact Policy Impact Calculations model). The results show that the production systems are very different in many respects but share similar development trends. Whereas intensive systems use graded animals and invest heavily into feeding, buildings and machinery, extensive systems use local breeds and invest minimally. Total cost of milk production falls with increasing herd size, while dairy returns vary among farms from 18 to 35 USD/100 Kg of milk. All systems make an economic profit, except the intensive one-cow farm, which heavily employs family resources in dairying. Due to better management of resources and access to inputs and markets, dairy farming closer to urban areas and using improved breeds is highly profitable, especially with larger herd sizes. Stakeholders should favour such practices as well as others which can improve productivity, especially in African countries where traditional systems dominate dairying.