Managing Director, FrieslandCampina WAMCO Nigeria Plc, Mr. Ben Langat, spoke with select journalists on its continuous investments in Dairy Development Programme (DDP) and the challenges of replicating the scheme in other states. Jonathan Eze provides the excerpts:
What is your overview of Nigeria’s dairy sector?
The dairy sector continues to feel the impact of a slowly recovering economy like other fast-moving consumer goods (FMCG) sectors. This has given rise to change in shopper behaviour with smaller portion packs being bought with an increased frequency in proximity shops. Availability and affordability therefore, remain major determining factors, given low disposable income among the population. Having said this, affordability must be matched with quality to ensure adequate nutrition.
This is the balance FrieslandCampina WAMCO offers consumers. With increasing figures of malnutrition across the country, we consistently ensure consumers have access to quality dairy nutrition in various portion packs to reach everyone at the right price. It is important for the consumer to be educated on different dairy product offering and align to their nutritional needs. Dairy is offered in full cream, filled, ready to drink, among others. We have a mission to nourish Nigerians with quality dairy nutrition, hence our commitment to providing affordable dairy for families, and offering informed knowledge on the goodness of milk to consumers across all life stages. We believe in Nigeria and we are here to stay.
What level of success would you say your Dairy Development Programme (DDP) has achieved and do you have plans to replicate this success in other states across Nigeria?
We have made very good progress with the DDP. We started with a milk collection centre in 2011, now we have five milk collection centres and a bulking centre, which is where we pool all the milk into a truck and move it to the factory.
The main challenge is low productivity per cow. When cows roam for long distance to gather pasture and drink water, it impacts productivity, which currently stands at one litre per cow average.
To raise that to commercial quantities, we should be aiming for say ten litres per cow. Iseyin in Oyo state, where we currently operate the DDP with growing success, is not too far from our factory in Lagos, so we move milk daily. Other challenges include feed, poor infrastructure, among others. Secondly, there is a good concentration of farmers that have lived there for many years who have traditional knowledge of herding. There is still a lot of work to be done. To scale up milk volume per cow, you need the right kind of breeds. We must acknowledge that other states have approached us to bring the DDP to them.
Could you be more specific?
We were humbled by the visit of the Governor of Kebbi State to seek support for his efforts in improving dairy in his state. We have sent our people to give technical support to the state. It is very difficult to move fresh milk from Kebbi to Lagos by road in time for processing. However, whenever sustainable fresh milk volumes are substantial enough in a location, FrieslandCampina WAMCO will be more than ready to start processing there.
Are you satisfied with the level of support you and other big dairy companies in Nigeria are getting from government on the DDP?
FrieslandCampina WAMCO is the only multinational involved in dairy development in Nigeria and we do this in partnership with the Federal government. We have had the Minister for Agriculture and Rural Development, Chief Audu Ogbeh, honour our invitations and sometimes set out with our team as early as 6 o’clock in the morning from Ibadan to Fashola Community in Oyo because he wanted to see farmers milking their cows.
That tells you there is a huge support and commitment from the Federal government. For similar reasons, we commend also Oyo State Government. Government would also do well to improve infrastructure, especially by providing good roads, water and power. You can’t do anything with cows without a good supply of clean water. So far, we have sunk 45 solar-powered boreholes, which provide water not only for the cows but also for all the five communities where we are already succeeding with the DDP – Fashola, Maya, Saki, Iseyin and Alaga.
Why do you think other big players in the dairy sector are yet to follow your example?
It is very simple. This is a costly exercise that need financial and other resources investment and takes time to make money from it. We do it as a responsibility in line with our purpose of providing better nutrition now and for generations to come. FrieslandCampina WAMCO is here for the long run. We are committed to our mission of providing quality dairy nutrition for Nigerians and improving the living standards for our farmers now and for generations to come. Our shareholders have invested in the DDP because we are looking at the bigger picture and there is a point where the two cross, that become both sustainable and profitable. We are continuously investing in the DDP and we believe in the future of the programme.
So, what will work best for Nigeria and do we have similar examples elsewhere?
Smallholder farms have been the most successful dairy model so far and that is the model for FrieslandCampina WAMCO DDP. Every household that has some land can build a business on it with five to 10 cross breed cows. It makes it easier for us to collect milk. If you go to countries like Kenya, Zimbabwe, South Africa and Uganda, smallholder farmers are thriving. So, in Oyo, our DDP is progressing from pastoralists to smallholder farms. With cross breed cows, you can get up to 10 to 15 litres of milk per cow instead of just one or two litres.
How exactly have you handled technology transfer as part of your ongoing DDP?
We have a programme called Farmer2Farmer, where farmers from The Netherlands visit Nigeria, spend time with farmers in Oyo State, interact with them to share global best practices with our local farmers. We organised Nigeria’s first ever Dairy Farmer’s Day late last year. Leading to the event, two Dutch farmers spent about two weeks in the DDP communities, training local farmers on best dairy farming practices. This has yielded a lot of benefits and will be continued.
Farmer2Farmer language is well understood irrespective of where they are in the world. They got very practical, demonstrated what nutritious pasture is and what it isn’t, what is hygienic for cows and what isn’t. Some of our smallholder farmers now have farms bearing similarities to what you will see in a commercial farms in The Netherlands with improved hygiene and proper keeping of farm records.
Looking at your 2017 financials, what is your outlook for 2018 considering the gradual strengthening of the economy?
We need the economy to grow again and exchange rates to remain stable and forex continue to be available. Consumers need more disposable income. If these happen, we should have a good year.
How many jobs do you see the dairy sector creating for Nigerians?
Let me use our DDP pilot to illustrate the endless possibilities of job creation we bring to the sector. At the moment, we have about 3,500 dairy farmers—male and female. Please dwell on the fact that this has brought a very positive lifestyle change to the female farmer who would typically petty trade her “wara” or local cheese. But now she earns much more, her income is steady and growing. So is her husband’s. Among the 3,500 farmers, you will see one farming cluster depositing as much as 500 liters of milk to our collection centre because he and many others bring their cows together, live in one place, milk their cows together and deliver their milk as one.
So, one man out of the 3,500 can represent a pool of 200 – 300 others. If you go to the five locations where we have the DDP – Fashola, Maya, Alaga, Saki and Iseyin, all in Oyo State—, you will see a booming adjunct industry that wasn’t there before – suppliers selling dairy feed, minerals, milking cans, and veterinary medicine, among others. What do you think will then happen as we further develop nutritious pasture for the first 50 smallholder farms, which we have already identified? Imagine the multiplier effect!
Beyond Oyo, are there plans to take this to other parts of the country?
There are huge infrastructural limitations to contend with, which only government can take care of. But we are ready to expand the DDP to other regions systematically because it is very expensive. When our current pilot becomes even more successful and profitable, it will become easier to replicate. They are so many opportunities. For example, the school feeding programme initiated by government, which we are actively involved in, the possibilities are endless.