RSB: Effective Cooperative Model can Make Dairy Processing Competitive

RWANDA - The local dairy processing sector, according to Rwanda Standards Board (RSB), has been facing a number of challenges that includes having too many processing units operating in isolation, leading many to struggle meeting set standards or become competitive because of limited resources.
calendar icon 6 March 2018
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The New Times reports that some factories use rudimentary technologies, as they lack equipment to heat or cool milk.

Products or services can only be competitive if they are of quality. However, quality comes with a cost to which there is no short-cut, says Antoinette Mbabazi, Division Manager of National Certification at RSB.

In a recent interview with Sunday Times, Ms Mbabazi said that factories are an expensive business, pointing out that if one wants to be competitive, they need to make significant investments, which local processors can achieve if they effectively work together in cooperatives.

"You cannot compete with imported products, or even locally produced products if you still struggle to meet minimum standards," she said.

Milton Ngirente, Owner and Managing Director of Blessed Dairies Ltd, a milk processing firm in Gicumbi District, said Rwanda Standards Board’s proposal to work under cooperative model is informed by its assessment of the dairy processing business; and as it knows the efforts that are needed for the sector’s performance, it realises that the individually owned factories are not performing well.

"Dairy processing factories require huge investments. The idea [to work together] itself is good. For instance, instead of having 10 people owning factories making cheese, they should merge to have one factory that has more capacity," he said.

However, he said, the issue that remains is on its implementation to make sure that it is successful.

"Some people have selfish interests and divergent views which can result in the collapse of the company or cooperative. Bringing together financial means from people with divergent views cannot yield good results," he said.

Blessed Dairies processes about 6,000 litres of milk per day, from which it makes products such as yoghurt and cheese. But, Mr Ngirente says that if he had means, he could make more products because there is still gap to fill in the supply of dairy products vis-à-vis the available demand.

The firm is in negotiations with farmers under IAKIB – a cooperative for modern dairy farmers in Gicumbi District – so that they set up a processing factory to process more milk in the district. The cooperative collects about 35,000 litres of milk per day, of which 5,000 is supplied to Blessed Dairies.

At least 20 types of cheese can be made from milk, yet but Mr Ngirente says that only two types of cheese, and mozzarella, are largely produced in Rwanda, noting that there is no factory specialised in cheese production in Rwanda.

Rwanda produces about two million litres of milk per day, but about 10 per cent of it is processed.

According to information from Rwanda Development Board (RDB), the opportunities in dairy processing in Rwanda include fermented milk, yoghurt, cheese, butter, ice-cream, milk powder, ghee, flavoured milk, sweetened milk, among other products. The cost of a processing facility is $8.5 million (about Rwf7 billion).

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