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July 16, 2008

Ugandan dairy doubles milk collection from farmers

For the last 18 months, Uganda's Sameer Agriculture and Livestock Limited’s (SALL) raw milk collection has increased from 50,000 litres to 120,000 litres per day with a monthly income of Shs1.4 billion (1US$ = 1,620UgSh) up from Shs330 million to dairy farmers. SALL predicts their milk collection is likely to hit 300,000litres in the next 6 months.

Sameer is a joint venture established by Sameer Group of Kenya, which operates various businesses in East Africa, and RJ Corp, a food and beverages industry in India.

Sameer took over the Dairy Corporation Limited (DCL) in August 2006 with only 60 milk collection centres mainly in South-Western Uganda which it has today increased to 100, spread in Eastern, Central and Western Uganda.

DCL had been instituted by the government of Uganda to buy, process, and market dairy farmers’ milk but failed as it was embroiled in challenges of inadequate funding and vehicles like milk tankers, dilapidated machinery and demoralised workforce.

As such DCL was unable to buy farmers’ milk and frustrated farmers sold their animals and switched to crop and beef production. Sameer intervened to rejuvenate the dairy industry in Uganda.

About 50,000 dairy farmers are partnering with Sameer all over Uganda. Sameer’s current processing capacity of over 400,000 litres daily offers dairy farmers a guaranteed market for their milk compared to DCL’s time “where milk was going to waste during flush period”. This, according to Sameer, has contributed to employment.

By the time of take over, DCL had nearly all its equipment broken down. Today Sameer has repaired the chilled water refrigeration system enabling them to get a 240 tonnes refrigeration capacity and bought new vehicles.

Sameer has installed three pasteurized milk machines and cream separators to boost their production capacity.

It cost Sameer US$15 million to erect the milk powder plant that was commissioned in January 2008. Sameer’s products are sold under the “Fresh Dairy” brand. Currently Sameer produces skimmed milk powder, full cream milk powder, pasteurized milk, plain and flavoured yoghurt, ghee, butter and ultra heat treated (UHT) milk among other products. Sameer presently exports over 300,000 litres of UHT milk monthly to Rwanda which DCL had never recorded.

The corporation is to launch field extension services for dairy farmers soon to educate them on animal health, disease control, animal feeding and dairy animal breeding. This is aimed at boosting milk returns. SALL claims to be offering interest-free loan facilities to farmers and arranging for credit from commercial banks so that they can buy dairy farm implements.

It cost Sameer US$15 million to erect the milk powder plant that was commissioned in January 2008.

The Independent

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