Livestock Research for Rural Development 12 (2) 2000

Citation of this paper

Perceptions of livestock service delivery among smallholder dairy producers: case studies from Central Kenya

John Morton and Valentine Miheso*

Social Sciences Department, Natural Resources Institute, Central Avenue, 
Chatham Maritime, Kent ME4 4TB
* International Livestock Research Institute, Nairobi, Kenya
(Now of: Land O'Lakes, Nairobi, Kenya)


The article examines the perceptions held by smallholder dairy producers of the various livestock services delivered to them and the organisations that deliver them. In particular it examines perceptions of the dairy cooperatives, formerly part of the state marketing system and now liberalised, and of newer and less formal self-help groups. In Kiambu District, close to Nairobi and characterised by intensive production, there is a highly competitive market for milk, a high degree of reliance on purchased feed and fodder, and a competitive market for livestock services. Farmers are prepared to accept lower milk prices from cooperatives than they would get elsewhere, if the package includes: monthly payment which allows budgeting for livestock and other expenses and a degree of short-term credit to allow access to feed and AI. Farmers retain an affection for the idea of cooperatives, but feel poorly informed and unable to participate in the face of the size and bureaucracy of the cooperatives. In Ol-Kalou, further from Nairobi and characterised by semi-extensive production, Self-Help Groups have been successful so far in attracting farmers with a package that centres on collective contracting with private dairies (and Kenya Cooperative Creamery) with a minimum of physical handling and marketing, and of other services. In both cases it is difficult to separate producer evaluations of particular services from overall perceptions of ownership and governance of the service delivery organisation, and of the widely varying commercial alternatives available.

Key words: Marketing, milk, cooperatives, smallholder dairyhing, Kenya, 


As livestock services, like other agricultural services in developing countries, have undergone liberalisation, livestock producers are faced with a range of service delivery organisations, public and private. It is timely to document what livestock producers look for in service delivery, and how they evaluate the organisations that deliver services. Smallholder dairy production presents particular interest in this regard, because of the range of services needed (marketing, credit, AI, clinical veterinary care, feed supply, extension) and the critical timing issues involved. This article describes the perceptions held by smallholder dairy producers in Central Kenya of the various livestock services delivered to them and the organisations that deliver them. It demonstrates the difficulty of separating producer evaluations of particular services from overall perceptions of ownership and governance of the service delivery organisation.

The Kenyan dairy sector was dominated during the 1970s and 1980s by the Kenya Cooperative Creamery (KCC), which although in formal terms a cooperative of large scale producers became to all intents and purposes a parastatal with an official monopoly over milk marketing (Jaffee 1995). Within Central Kenya, where smallholder dairy production for the Nairobi market is particularly significant, smallholder dairy cooperatives acted as marketing agents within the monopolistic system dominated by KCC. These cooperatives were part of a nationwide and state-sponsored cooperative movement, subject to a high degree of government control, and regarded by farmers as effectively part of the government structure. (1)

During the 1990s, there has been a threefold process of liberalisation affecting the smallholder dairy sector: a liberalisation of veterinary services in 1991 allowing cooperatives to offer AI and clinical veterinary services, and a liberalisation of milk marketing in 1992. More recently there has been a liberalisation of cooperative law itself, designed to transform cooperatives into genuinely self-governing organisations, without government interference or government support (Morton et al 1999).

The initial response of cooperatives in Central Kenya to the liberalisation of services and milk marketing appeared positive. Cooperatives sought alternative buyers for their milk among the emergent private dairy processors, and diversified into providing AI, veterinary and feed supply services, with the provision of short-term credit for these services to their members (Owango et al 1998). The provision of inputs and services on credit served both to keep members' loyalty and to maintain milk yields, keeping milk intake levels high and giving the cooperatives economies of scale in their marketing and input supply services.

By late 1997, however, many cooperatives were finding it difficult to compete with "hawkers", individual buyers of raw milk, and to cope with serious arrears in payment by KCC. While some retained member loyalty, others entered a downward spiral of losing active membership, losing economies of scale on ancillary services and further losing membership which was attracted by those services (Morton et al 1999; Morton et al forthcoming).

At the same time, a number of Self-Help Groups (SHGs) emerged, with varying origins (including from collapsed cooperatives) and registered under varying frameworks, but all attempting to operate on principles of collective self-help while avoiding negative features of cooperatives. They were generally smaller than the cooperatives, less bureaucratic in procedures and more autonomous from government. In the densely populated areas closest to Nairobi, SHGs failed to compete with hawkers on the one hand and cooperatives on the other and proved transient. In more distant areas within the Nairobi milkshed, characterised by semi-extensive production and greater distances to market, they appear to have found a more permanent niche, bulking up milk supplies to sell on to private dairies (Morton et al 1999; Morton et al forthcoming). One difference with the cooperatives is that SHGs consider themselves entitled to limit the size of their membership. Such a policy, other than on clear grounds of residence or willingness to participate in the cooperative's activities, is normally considered contrary to cooperative principles, internationally and in Kenya.

Within this context, we chose to examine farmer perceptions of livestock service provision in two areas. One was Kiambu, a densely populated district immediately adjacent to Nairobi, where dairy production is carried out by smallholders with very small average landholdings, and typically one or two grade cows (Staal et al 1997). This district is home to some successful cooperatives and some cooperatives struggling to survive. The other area was Ol-Kalou Division of Nyandarua District, about 150km from Nairobi by road, site of some successful SHGs. This district is characterised by semi-extensive production on larger holdings, and longer distances to market. In the case of Kiambu, we were interested particularly in the value farmers placed on the provision of interlocking marketing, credit and input supply services, which appeared to be a key factor in the survival of some cooperatives: it was less clear how this operated for SHGs.

Semi-structured group interviews were carried out in five locations: three in Kiambu District and two in Ol-Kalou Division. The intention was to hold in each location separate meetings with active members of a cooperative or SHG, and with other farmers in the area. In Kiambu District interviews were held in the areas of operation of a large, medium and small dairy cooperative respectively. The non-members groups in these areas were a mixture of genuine non-members, registered members who did not sell milk through the cooperative, and farmers who were members of cooperatives in other areas. In Ol-Kalou Division interviews were held in the areas of operation of two SHGs, one with almost 200 members, one with 35. The "non-members" groups in these areas consisted of farmers who did sell milk through these SHGs, but who were not registered members, owing, as it turned out, to a deliberate policy by the SHGs to limit their size. Neither in Kiambu nor in Ol-Kalou were committee members or office-holders of the cooperatives/SHGs present during interviews: they were interviewed separately afterwards unless they had been interviewed on previous visits by researchers associated with the project.

Interviews were held in Kikuyu, the local language. The greater part of each interview involved taking each agricultural service in turn, checking what organisations or individuals provided such a service in the area, and eliciting perceived advantages or bdisadvantages of that service provider. General perceptions of the cooperative or SHG were also covered. (2)

Kiambu District

Surprisingly, perceptions of the advantages and disadvantages of particular service providers showed a considerable degree of overlap and few systematic differences between members and non-members (3) and they are merged in the presentation of results that follows. What differs is the overall evaluation of the cooperatives, based in part on these perceptions of individual services. Smallholders in Kiambu District are able to market their milk to Cooperative Societies, hawkers, "middlemen" (larger-scale traders in raw milk), hotels (i.e. small hotels/restaurants in market areas), milk-bars and kiosks, and to neighbours. In addition, in one of the areas researched, a private dairy is beginning to buy directly from smallholders. The advantages and disadvantages of selling milk to these various actors were collected. The table below synthesises the results for all six groups. As will be seen, farmers were not ready to distinguish between the advantages of the cooperative as a milk-marketing channel, and its more general appeal to them.


Table 1: Advantages and Disadvantages of Milk-Marketing Channels, Kiambu
Advantages of Cooperatives Disadvantages of Cooperatives
  • Pay in a monthly lump sum so farmers can plan expenditure
  • Offer an assured permanent market
  • Offer inputs, AI, food, tractor hire on credit
  • Give cash loans
  • Collect close to the farm
  • No limit to amount farmer can supply
  • Farmers know their cash is safe
  • Exert quality control over milk
  • Farmers have a sense of ownership
  • Allow farmers to invest in coop assets
  • Low prices
  • No bonus payments
  • Delays in payment
  • Profit margin is very high
  • Underweighing, adulteration and stealing by workers
  • Farmer is charged for rejected milk (even if workers are to blame)
  • Do not allow their members to sell to others (but this is not enforced)
  • Mismanagement of accounts and factionalism
  • Charge a registration fee
  • Charge a fee (or collect arrears on members share of coop debts) when member recommences delivery after a break
Advantages of Hawkers/Middlemen Disadvantages of Hawkers/Middlemen
  • Higher prices
  • Prompt payment in cash
  • Payment can be negotiated as daily or monthly
  • Bear cost of rejected milk
  • No registration fee
  • Give advances or loans (but very short-term and very rare)
  • Collect milk from farms
  • May disappear with farmers' money
  • As there is no written agreement no hope of follow up
  • Not a reliable market
  • No lump-sum payment so farmers cannot plan expenditure
  • No supply of inputs and services, or credit on inputs and services
  • Arbitrary changes of prices without prior knowledge of farmer
Advantages of Hotels/Milk-bars/Kiosks Disadvantages of Hotels/Milk-bars/Kiosks
  • Slightly higher prices than coop
  • Payment can be negotiated as daily or weekly
  • A reliable market
  • Cannot disappear
  • Will find an alternative buyer on days they cannot buy
  • No security - the business can close - No credit
  • No inputs
  • Cannot pay monthly
  • Cannot take all the milk
Advantages of Neighbours Disadvantages of Neighbours
  • Collect from farm
  • Flexible times for collection 
  • Price is higher and negotiable
  • Not a reliable market
  • Can delay payments or refuse to pay
Advantages of Private Dairies Disadvantages of Private Dairies
  • Better prices
  • A reliable market
  • Prompt monthly payments
  • Give true weight
  • Bears cost of spoilage once milk is received
  • A new thing - not well known
  • Not always reliable
  • Rumours they are going into receivership
  • Arbitrary changes in the amounts they buy and prices without prior warning to farmer

The advantages of cooperatives that consistently emerged are that they offer lump-sum monthly payment, which allows farmers to budget, that they will buy all milk offered to them, that they offer credit on feed and AI (as well as human food, fertiliser and tractor hire in some instances) and that they offer cash loans (albeit very limited). Farmers also cited their sense of ownership in the cooperative and its assets, and the fact it generated employment, as advantages. What would appear at first sight to be their most significant disadvantage is their low prices, between Ksh3 and Ksh5 per kg less than that offered by hawkers. (4) This was not a major issue. Farmers were in fact more vociferous about general issues of cooperative management or mismanagement, including abuses by employees. Farmers in all three areas said they would accept lower prices in return for access to other services: the most important issue was the quality of those services. One cooperative operated small retrospective price adjustments at the end of each month (which could result in farmers getting less than expected), one offered different prices in different areas, and one operated both systems. Neither system was seen as intrinsically unfair or problematic.

Neighbours, and hotels etc. represent a limited market, and in the one area where a private dairy was buying milk, distrust of it was quite striking. The major competitors to the cooperatives are the hawkers. Their clear advantage is price, and their clear disadvantage is their unreliability; both in not guaranteeing to buy every day and in sometimes running off with money. Hawkers generally pay daily; though it seems increasingly that some will offer weekly or monthly lump-sum payment that would be valued by farmers, their perceived unreliability prevents farmers from taking this up. Daily payment is evaluated ambiguously: most farmers see it as a disadvantage but in some circumstances it comes in very useful. The practice of selling some milk to the cooperative and some to hawkers is known to be widespread, and some groups were explicit about this as a strategy for meeting short-term and medium-term budgeting needs. There was also a comment that farmers prefer to have various marketing channels to strengthen price competition.

It was suggested that those who sold to the coop rather than hawkers are primarily those able and motivated to budget with lump sums: the wealthy, those producing lots of milk, the educated, those with alternative income sources, those with children, those wishing to benefit from credit on inputs, and men. However, other factors, such as living in remote areas (where hawkers do not collect) were also mentioned. Those unable or unwilling to wait for lump sums, who are seen generally as the poorer, but also as "short-sighted" or even "enemies of the community", would gravitate to the hawkers. ILRI/KARI's characterisation study of Kiambu (Staal et al 1997) shows that the cluster designated as "informal resource poor" which has very low coop membership and very high rates of participation in the informal milk market, is poorer than the average, and poorer than the cluster designated "cooperative resource poor" in farm size, number of dairy cattle and farm size per tropical livestock unit (TLU).

For livestock services other than milk marketing, there were fewer alternatives available to farmers. Information on the advantages and disadvantages of each service provider for each service was collected as above, but it is summarised more briefly here.

The clear alternatives for Kiambu farmers to obtain livestock feeds are the Cooperatives and private stockists. The cooperatives are liked mainly because they offer feed on credit, but otherwise are the object of scathing criticisms: lack of variety, poor quality, high prices, disrespect or dishonesty on the part of the staff, and lack of transparency in accounting, so that farmers are unclear if the store subsidises the cooperative or vice-versa. Private feed stores offer a far better service, including delivery of feed in some cases, but only offer credit in exceptional cases. No farmers commented on the physical or administrative convenience of dealing with one body for milk marketing and feed (as distinct from the credit issue). Comments on what sorts of farmers use the cooperatives and the private stockists were partly contradictory. Farmers with lot of milk use the cooperatives, but they sometimes also buy higher quality feed elsewhere and mix it; less-educated farmers who do not care about quality use the cooperative; lower-income farmers buy privately to be sure of quality. Suppliers of AI for smallholders comprise some cooperatives and private vets, and in rare cases government vets. A substantial proportion of farmers are still using natural service; this was apparent even in the area of the largest cooperative. Again, in terms of the quality of service, cooperatives scored very low, being accused of delays in inseminating, low success rates, and offering no variety of semen. It also concerned farmers that cooperative inseminators, unlike vets, could not diagnose and treat fertility and health problems. The sole advantage of cooperatives over private vets was offering credit.

Natural service is seen, at least by its supporters, as offering higher conception rates, but has disadvantages in passing on disease, injuries, and problems of transporting cows. Some farmers think that it is the less-educated who still use natural service. Only in one of the interview sites does the cooperative offer clinical veterinary services. Otherwise there is in principle competition between government and private vets, but government vets are unlikely to be available at a convenient distance, and little information was collected on them. The negative perception of cooperative veterinary services, even where they operate, was clear.

Cooperatives occasionally supply some education services to their members, on general topics, on cooperative affairs, and on livestock production. The latter seems to consist of attracting drug and feed manufacturers, as well as government staff, to address farmer groups. Evaluation of both extension and general education was lukewarm. Seminars are infrequent and poorly attended, and farmers felt that farmer education on cooperative affairs was a badly missed opportunity to improve overall management and participation. Farmers were not even aware of the new Cooperative Act. The only comment recorded on government livestock extension services was that they were 'slowing down'.

Although short-term credit for feed, AI etc. is clearly popular (5), "credit" was taken by interview participants to mean cash loans. Cooperatives offer the possibility of cash loans for items such as school fees and medical expenditure, but farmers have, at least in principle, alternative options of the Church SACCOs (6), commercial banks, the Agricultural Finance Corporation, and Merry-Go-Rounds. (7) Farmers judge credit organisations primarily on interest rates, then on the ease of processing loans. Farmers seem to have little awareness of the real cost of credit or the requirements of the credit market.

Generally the Church SACCOs were the preferred source of credit, because of low (probably subsidised) interest rates. Cooperatives (and the guaranteeing of loans from District Union Banking Sections through the cooperatives) was next most favoured, but the requirement of some cooperatives for presentation of title deeds as security was disliked, especially by women. There was a general perception that Commercial Banks and the AFC were "not for the common people". It was felt that women in particular were more likely to use Church SACCOs, as they were more likely to be active church members, are unlikely to have collateral, and do not mind (or even actively prefer) dealing with smaller loans. Women are also said to depend on Merry-Go-Rounds for many household needs, although these are not a credit source competing with SACCOs, cooperatives or Banks. Men, especially those with title deeds and those marketing a lot of milk, are more likely to use the cooperatives, banks, or a new institution of men's Merry-Go-Rounds dealing in larger sums than those of women. 

There was a lot of variation between the three cooperatives studied in terms of the way members and non-members viewed them. In the case of the largest cooperative, members were unenthusiastic about it and seemed to see it as something external to them, but were not (with several exceptions and qualifications) generally unhappy with it. There were however comments that members were happy only because they were paid on time, or because there was no serious competition. Members of the medium-sized cooperative were at a general level more enthusiastic about it, and referred to it as "their mother and their child", although they raised more specific complaints about the standards of services, transparency of management and conduct of employees. Non-active members of this cooperative did not feel any sense of ownership, and claimed that they would not be upset if the cooperative collapsed. The smallest cooperative clearly suffered from entrenched factionalism and lack of participation (to say the least), and there were extreme charges of mismanagement and corruption during our interviews. Despite all this, there was a sense, even among non-members (or non-active members) of ownership of the cooperative, what was lacking being a sense of control.

Within this variation, several common themes emerged: 

Ol-Kalou Division, Nyandarua District

In general, members and non-members (i.e. those using the SHG but not registered as members) both evaluated the SHG services positively. Non-members were more likely to express criticisms of overall management, and in particular the policies that kept them non-members, as indirect disadvantages to them of using SHG services. The SHGs face competition mainly from hawkers, hotels, and sales to neighbours , also from "agents" (large-scale hawkers hoping to sell to private dairies) and one of the surviving cooperatives. The larger SHG operated a draconian system of fines and eventual expulsion on members selling to hawkers, while the smaller SHG appeared to tolerate occasional sales to hawkers to meet urgent cash needs.

Table 2: Advantages and Disadvantages of Milk-Marketing Channels, Ol-Kalou

Advantages of SHGs Disadvantages of SHGs
  • Cash advances for school fees, sickness, etc. (depending on milk delivery but interest free)
  • Lump sum payment allows for financial management
  • Prompt, reliable payment
  • Feed, AI services on credit
  • Bonus payments
  • Greater bargaining power
  • Acts as loan security in times of sickness
  • Collects at a convenient time
  • A flat rate service fee (i.e. service charges not deducted from milk sales)
  • Treats its members fairly
  • Pays into bank or cash
  • Milk is tested
  • No theft of milk
  • Inadequate cash to pay farmers promptly; monthly payment arrives on 10-15th of month: too late for payment of workers
  • Does not provide transport to collection points
  • Non-members not allowed to participate in elections or receive dividends
  • Members have closed registration of new members
  • Only pays through farmers' SACCO, not through commercial banks
  • Lower prices
  • Unreliable, may not buy everyday
  • Recent problems with late payment
  • Cheques posted to the wrong bank
  • SHG is not progressing
  • Management is not good
Advantages of Hawkers Disadvantages of Hawkers
  • Cash payment
  • Create competition
  • Milk goes bad by the time they collect
  • Payment is irregular
  • They disappear
  • Difficult to save on cash payment
  • Encourages crime (people know how much you have been paid)
  • Members are fined if they are known to sell to hawkers
Advantages of neighbours Disadvantages of neighbours
  • Improves nutrition of the community
  • Non-payment produces enmities


Farmers see a variety of advantages, direct and indirect, in selling to the SHGs: lump-sum monthly payment with some possibility of advances, access to (rather limited) feed and AI services on credit, and a sense that the SHG as a whole can negotiate good terms with private dairies or KCC. Disadvantages were reported mainly by non-members (who were, however, still selling milk through the SHG). Prices varied considerably between the two groups: the smaller SHG sold for 16Sh/kg and gave the farmer 15.30Sh/kg, while the larger SHG was getting 15Sh/kg from KCC, and only giving the farmer 13Sh/kg. Hawkers in the area were offering 16-17Sh/kg. This suggests that farmers were motivated by the lump-sum system, by fear of the unreliability of hawkers, and by the sense of a stable market for their milk, to forego a considerable part of their milk price, even where the SHG role in physical collection and marketing was minimal. In neither area was there any sense that SHG members were differentiated from non-members selling milk to the SHG or non-members not selling milk to the SHG by any pattern of wealth or background, except that the larger SHG had emerged originally because cooperatives had prevented the married and independent children of members becoming members in their own right. Neither SHG provides anything except limited and occasional feed supply services; in practice farmers rely (to the extent they buy concentrates at all) on private stockists. These are viewed with considerable suspicion as expensive, overcharging on transport, selling fake feeds, and involving time consuming journeys.

The larger SHG employs an inseminator, whose prices are similar to those of the private vet, but whose services are given on credit to SHG members and (possibly) to non-members delivering milk. The members interviewed all claimed to use AI exclusively, but natural service is also clearly common in the area. (8) In the area of the other SHG there is no AI service available, although farmers would like the SHG to start offering AI. (9) The advantages of AI are seen as: avoidance of disease, a choice of breeds, and breed improvement in the direction of high milk yields and rapid calf growth. Natural service is seen as presenting risks of in-breeding, and mating of immature heifers.

In one area there is effectively no government provision of veterinary services. In the other, some government provision is available, and farmers were able to compare government and private services. It was felt to be wealthier farmers who use private vets. Suspicion of private vets was extremely marked in both areas. Allegations were made (which of course the researchers had no way of verifying) that they lacked qualifications, misdiagnosed, under-dosed, sold fake drugs, overcharged, and poisoned cows out of personal grudges. Government vets are seen as hard working and cheap, but lacking transport and drugs, and over-committed. For veterinary drug supply, the only choice was between stockists in the village and those in larger market centres. The latter were also accused of various misdemeanours, the former seen as harder working and more honest, despite stocking a smaller range of drugs. 

The larger SHG has some role in extension, inviting people from outside to address farmers. This service is not separately charged for. Government extension services are very limited, although some wealthy farmers may pay transport costs for individual visits by extension officers. There was a wish that government services could be revived, either through extension or through government veterinary services, which were not seen as any less likely to deliver production extension or use a whole-farm approach. Farmers also use radio programmes, chiefs' meetings, and neighbours and friends as sources of information, supplemented by trial and error, or information learnt in school. However, as one farmer said, animals die in the name of trial and error!

The larger SHG gives advances, for production and non-production purposes, limited to the amount of milk delivered that month, and also seems to act as security for credit granted by private feed suppliers, especially when it has no feed in store itself. There was some suggestion that it can give bigger loans, but this probably referred to the SHG's future plans, which appear to include loans to members to purchase cattle. The only true suppliers of cash loans at present are the Farmers' SACCO Bank and Commercial Banks. In both areas farmers were keen for the SHGs to become further involved in credit, although as in Kiambu, there was a general unawareness of the real costs and requirements of credit.

In terms of farmer ownership and participation, the SHGs clearly present a very different picture to the Kiambu cooperatives. Members clearly see the SHGs as belonging to them. A number of mechanisms give members a real say in the running of the group, but also place and enforce obligations upon them that are much heavier than in the cooperatives. In the larger SHG there are quarterly general meetings at which attendance is compulsory, and non-attenders are fined. In both SHGs, agendas combine items from the committee and from ordinary members, discussion is free, and members can advise the committee on important issues such as how to deal with those delivering adulterated milk. Office-holders in both groups are elected for two year terms, and there have been changes of office holder due to "individual character and behaviour". In the larger SHG ordinary members have the right to go through any files in the SHG office, and it also operates a system of fining members and expelling members who sell to hawkers. All these factors indicate truly member-driven organisations, and compare very favourably with the Kiambu cooperatives.

The major issue confronting both groups is whether to expand further. At the time of fieldwork, members of both groups felt that expansion would endanger the qualities of participation and discipline that are the groups' strengths, but they have been happy to allow substantial numbers of non-members to sell through the SHGs, on almost the same terms as members. In the case of the smaller SHG this was explained in terms of wishing to keep out those not known to members, and those who might deliver adulterated milk; in the other case it appeared more bound up with the desire to retain control over the real estate the SHG has acquired with members' contributions. In both cases this has caused resentment among these non-members, who are far readier than members to complain about poor management, and who mention the possibility of setting up their own group. By not addressing this, the SHGs risked losing "effective membership" and thus their economies of scale and bargaining power. In fact as of November 1999 this policy has changed for both groups and new members are being allowed. However, as the private dairies will apparently now negotiate over amounts as small as 50kg/day, the proliferation of groups of between 50 and 200 members each might not be an unfavourable outcome for the system as a whole.

Both groups talk of expanding their range of services, respectively to market more inputs, to invest in milk processing, and possibly to offer larger production loans to farmers, and to start stocking feed, to offer AI and to buy a cooler for storing afternoon milk for sale the following morning. The smaller SHG has not yet seen members' contributing new capital, but members express themselves ready to do so. These plans appear to be driven more by the prevailing distrust of private sector service providers than on a real assessment of need or chances of success. This may push SHGs prematurely into activities for which they do not enjoy economies of scale, and which risk making their management over-complicated and ultimately less attractive to members.

In neither area did either members or non-members express any desire to register as a cooperative, notwithstanding the new policy. Cooperative registration is seen as too bureaucratic, the Ministry of Cooperative Development as too powerful, and the cooperatives themselves as un-transparent, corrupt, poorly managed and late in payments to farmers. Although the SHGs operate on cooperative principles the very word "cooperative" is disliked.


In terms of methodology, the following conclusions can be tentatively drawn from the above accounts:

The most important conclusions from the interviews in Kiambu are as follows:

These conflicting perceptions of farmers are clearly contributing to a situation in Kiambu where the position of the co-operatives is precarious.  On the basis of active membership and milk intake, many, but by no means all, of the Kiambu co-operatives seem to be in serious decline (Morton et al 1999; Morton et al. forthcoming).  While some of these conclusions are specific to the situation in Kiambu and the history of state-sponsored co-operatives there, others can tentatively be generalised to this sort of intensive dairy system:

Ol-Kalou is characterised by semi-extensive production, and consequently by a lower degree of reliance on purchased feed and fodder, higher distances to market for milk, and higher distance-related costs of service provision.  The major conclusions from the interviews in Ol-Kalou are as follows:

 While some of the comments on private feed and veterinary services can no doubt be ascribed to farmers’ perennial dissatisfaction, the accusations were sufficiently serious and sufficiently shared among farmers for them to be taken seriously.   It is plausible that with the lower population densities and greater distances to market in Ol-Kalou, competition might be less intense and abuses more likely.  If such a situation really does exist, there is a need for the state to exercise its proper regulatory function to prevent fraud against farmers. 

Conclusions more generally relevant to less densely populated semi-extensive dairying areas, therefore, might be:

A general conclusion stemming from the comparison of the two areas relates to the decision that the SHGs had taken to limit new members.  Farmer-controlled enterprises may reap important benefits in terms of meaningful member participation and member loyalty from such a policy, but it has to be evaluated in terms of the optimum size to reap economies of scale under specific market conditions.   



The authors would like to thank their collaborators at NRI and ILRI in the larger study of which this research forms a part for support and encouragement: particularly Jonathan Coulter and Steve Staal. They also thank various staff members of the Ministry of Agriculture who assisted in interviews. The research was funded by the Natural Resources Policy Research Programme of the United Kingdom Department for International Development. However, views and interpretations expressed in this article remain the responsibility of the authors alone.



Hedlund H 1992 Coffee, Cooperatives and Culture. An anthropololgical study of a coffee cooperative in Kenya, Nairobi: Oxford University Press.

Jaffee S 1995 Perishable Profits: Private Sector Dairy Processing and Marketing in Kenya; In:  Jaffee S and Morton J (editors) 1995 Marketing Africa's High-Value Foods; comparative experiences of an emergent private sector Dubuque, Iowa, USA, Kendall Hunt Publishing

Morton J, Coulter J, Miheso V, Staal SJ, Kenyanjui M, and Tallontire A 1999 Provision of Agricultural Services through Cooperatives and Self-Help Groups in the Dairy sub-Sector of Kenya, NRI Report to DFID, also circulated as NRI/MoA/KARI/ILRI Smallholder Dairy Project Collaborative Research Report, Chatham and Nairobi.

Morton J, Coulter J, Miheso V, Staal SJ, Kenyanjui M, and Albright A, forthcoming: Coopertaives and Self-help Groups in a Liberalising Dairy Sector: the case of Central Kenya.

Owango M, Lukuyu B, Staal SJ, Kenyanjui M, Njubi D and Thorpe W 1998 Dairy cooperatives and policy reform in Kenya: effects of livestock service and milk market liberalisation; Food Policy, Volume 23, No.2, pp.173-185

Staal S J, Chege L, Kenyanjui M, Kimari A, Lukuyu B, Njubi D, Owango M, Tanner J, Thorpe W and Wambugu M 1997 Characterisation of Dairy Systems Supplying the Nairobi Milk Market. A Pilot survey in the Kiambu district for the identification of Target Groups of producers, Kenya Agricultural Research Institute, International Livestock Research Institute and Ministry of Agriculture, Livestock Production Department, KARI/MoA/ILRI Collaborative Research Project.

Received 14 December 1999

1 Hedlund (1992) written after prolonged anthropological fieldwork, convincingly makes this point for a coffee cooperative.

2 More detail on the interviews, particularly as regards the individual cooperatives and Self-Help Groups, is given in Morton et al 1999.

3 For convenience, farmers in the interview group in each location not composed of active members are referred to as "non-members" though many were registered members of the area cooperative or of other cooperatives.

4 At the time of the fieldwork, KSh (Kenyan Shillings) 60 were approximately equivalent to US$1.00.

5 Given that milk payments are frequently delayed by one or two months, it is a definitional point whether the facility to buy these inputs need be regarded as "credit".

6 Savings and Credit Cooperative Organisations

7 Rotating Credit Associations

8 79% of dairy farmers in Nyandarua district as a whole use natural service (unpublished data from the KARI/ILRI/MoA Smallholder Dairy Project).

9 Other SDP data suggest that farmers in Nyandarua see distance as a real constraint on use of AI: 3km is regarded as an impracticable distance.

10 As regards women this is supported by the cluster analysis of the recent SDP characterisation survey of the Nairobi milkshed (SDP unpublished data).

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