The Inclusive Dairy Enterprise (TIDE) - Uganda Improving dairy farm productivity, milk quality/safety, proactive regulation and dairy household nutrition The TIDE project identifies systemic market constraints, limiting the expansion of the dairy sector. It identifies opportunities for addressing these constraints by taking the lead in the formulation of relevant business cases, with implementation depending on the uptake by the private sector and in partnership with other organisations. Partnerships are sought to either strengthen institutionalisation of project initiatives or to provide leverage for business case implementation. Extensive use is also made of local organisations and expertise in project implementation, including District Local Governments. With dairy production reported to be consistently increasing at a rate of 7 % per year (and likely higher in the southwest), dairy farmers moving to intensification of production, cooperatives slowly building their market power and processors more and more competing for milk, opprtunutuies are aboud in the development of the dairy value chain
It is estimated that some 70 % of all milk produced on the farm reaches the market in one way or another. There is a regional variations, as in the southwest the market orientation of dairy farmers is much stronger than in other parts of the country (the aBi baseline gives a figure of 85 % for the southwest).Most of the milk marketed reaches the consumer in raw form. The share of the formal market (i.e. processed milk) over the last five years or so has increased from 20 % to 33 %. As there is now an export market for milk in processed form, no significant change may have taken place at consumer level. 
There is a growing trend for intensification. This is apparent in management:  55 % of all dairy farms in the southwest has a perimeter fence, while 35 % uses paddocks and 4 % is using zero grazing (according to the aBi baseline). Another indicator is breeding: more than 80 % of all dairy households in the southwest own crossbreeds, mostly Friesian (aBi baseline). While 35 % of all dairy households reported using some feed supplements during the year, purchase of fodder or hay is almost non-existent and on-farm production is also still very low. This explains the second key factor: the milk production during the dry season is 40 % lower than in the rainy season.

The Uganda Crane Creameries Cooperative Union (UCCCU) was only formally established in 2005. While it is supposed to be a national union, for now it only comprises of 10 district unions (all in the southwest), that in turn represent 128 primary cooperative societies. Its total membership base is 18,000 farmers, though at one time it was reported that only 4,100 of those were active. Considering that the livestock census (2008) reported that there were 114,000 households owning cattle in the six project districts, it shows that the cooperative movement has still a long way to go.
While the formal milk market was for long dominated by one processor (Sameer Agricultural and Livestock Ltd (SALL), this has drastically changed over the last few years. At the top end, two large-scale processors have recently opened dairy plants in or near Mbarara: Pearl (200,000 ltr/day) became operational in 2013 and is producing milk powder, mainly for export (to Kenya, the Gulf and Asia). Amos Dairies (300,000 ltr/day) became operational in 2014, and is mainly exporting casein (to USA markets). Their entry in the dairy market has significantly altered dynamics, bringing in an element of competition (SALL previously had a 90% market share). 
An important role within the sector is played by (mainly) private sector actors, providing services to dairy farmers. The role of the providers becomes the more crucial, once intensification of production increases in relevance. If farmers want to invest to increase production, want to upgrade their stock or want to use fodder or hay, inputs such as extension services, business advice, financial services, AI providers, pasture and fodder seeds and contractors able to construct suitable and reliable farm structures are a crucial ingredient.
The Dairy Development Authority (DDA) plays a crucial role, both in regulating the sector as well as in promoting its development. The balance between those two functions can also be a challenge. Some of the key regulatory challenges it is facing at the moment include ensuring that raw milk is safely transported and how to transform the informal sector
However, one issue remains contentious: the price of milk. Three factors influence price-setting by market actors; The competition in the market: this has certainly markedly increased over recent years, with the added processing capacity by different companies, though there are incidentally complaints of collusion (between the main buyers); The efficiency of processors: it is difficult to obtain reliable figures on capacity utilisation, but anecdotal evidence indicates it remains woefully low across the sector. Coupled with the large rainy-dry season fluctuations, this means that processors during the dry season are operating at very low capacity (and can therefore not afford to pay high prices) and have only a small window during the rainy season to maximise their production; Integration into the world market; the more the Uganda milk market is integrated into the global market, the more world market prices are likely to influence local prices. TIDE project didn’t carry out its own baseline but depends on the IOB study done by PWC to obtain (where applicable) the baseline information. The upcoming evaluation study for the aBi Trust project (May – June 2016) will provide the opportunity to fill in the missing baseline figure gaps. Already, TIDE has contributed to the updating of the questionnaire to be used in the study, suggesting changes that would assist in obtaining the missing data.If the required information was not available, we used proxy information to arrive to some estimates of the baseline information. For example, at the impact level, it was not possible to establish the farmers’ net income. The IOB baseline did not collect sufficient data on farm expenses to determine net income. As the indicator measures increase in net income, it is assumed that this equals increase in gross income. A margin of error will be determined through sampling in 2017.At the employment level, the number of new jobs created on farm and off farm levels is used as the performance indicator. Off farm jobs comprised of those created by the provision of services (e.g. AI, extension, veterinary practice, etc) by dairy service providers to the farmers. However, the TIDE intervention in production and cooperative development would generate new employment opportunities that would be difficult to capture. So we used the FAO estimate of jobs created within the dairy value chain, estimated at 10 off farm jobs for every 1,000 litres bulked into the cold chain; currently 300,000 litres /day are bulked in the cold chain (UCCCU). That is 3,000 existing jobs as our baseline.At the outcome level, the total milk production in the region is to be reported on, however the IOB study did not give an indication of the total milk production in the region and on-farm production is difficult to measure. To estimate this, milk marketed through UCCCU - milk sold on farm either to UCCCU or milk traders will be used (close approximation of the dairy production). Increase in milk production in the south west region will be tracked by using milk sales to UCCCU linked cooperatives and processors as a proxy indicator. According to the IOB report, 85% of the milk produced is sold (pg 65); and of the amount sold, 60 % is sold to UCCCU (according to DDA SW office figures for 2015). Total sales in the region would then equal sales to UCCCU * 1/ 60 % market share of UCCCU. Total production will then be total sales * 10/8.5. The current daily milk sales are 400,000 ltr /day according to DDA, Mbarara office (2016). Therefore Current production can be obtained by: Annual sales from UCCCU (400,000 * 7* 52) times 1.66 times 1.18 = 241,696,000 Litres, that we are using as the baseline.For water resource management, the IOB study gives an indication for baseline of the access of water for production at the house hold levels. The study gives the sources of water for production in the wet and dry season in the SW region. Pg 55, show the main source being Dug wells (43%), valley dams (29%) and pond / lakes/ rivers (21%). It’s the same sources for the dry season only the percentages change: Dug well (39 %), valley dam (32 %) and ponds/ Lakes/ Rivers (21 %). Households rely mainly on seasonal water for their production; A very low proportion of HH (3%) had access to protected water sources like piped and rain water. However, the key challenges of access, quality of water and affordability of water source development remain key issues.

For the improved dairy household nutrition, the project will contribute to the reduction of stunting in the house hold by influencing the dietary diversity at the household level. The aBi baseline measures the Food Consumption Score, but not Dietary Diversity Score. The current known DDS for the region is 55 %, i.e. 55 % of the sampled population had access to less than 5 out of 8 food groups (source: WFP/UBOS, 2013). At project intervention level, DDS will be measured and monitored, while at overall project level it is proposed that during the evaluation DDS will be measured, rather than FCS. By stimulating the market for demand for dairy improvement servcies, TIDE ensures that the private sector will have sufficient market to sustain the productivity improvement function of the project long after it has ended. TIDE also plays a role in builidng the capacities of service providers to ensure future provision of quality and affordable services that can be easily accessed by the dairy farmers. In addition to this, TIDE is catalysing the development and expansion of the on- farm investments market through supporting the intensification of dairy production at farm level. This is done through the development of TIDE Products (investments that enhance milk production) and provision of grants and subsidies to demonstrate the value of such products in productivity improvement.By building the capacities of dairy cooperatives through Agriterra, the provision of services to farmers will be sustainable. The TIDE project focuses on Poverty reduction through improved dairy farm incomes, household nutrition and employment opportunities, reaching 20,000 farmers. its objetcive is to mprove the functioning of the dairy sector in SW Uganda through a Business Case approach. This entails the creation of opportunities for the private sector and public partners to; Increase productivity of dairy animals and reduce seasonal production variations;pilot paying for quality of milk under the implementetion of the Quality Based milk Payment System(QBMPS);Make the sector more attractive for investment, by improving regulation amd improve nutritional status of dairy households The TIDE project targets dairy farmers to improve productivity and improve on the household nutrition. Its also targets dairy cooperatives to improve their governance, financial management and provisison of services to their members.