Livestock Research for Rural Development 16 (1) 2004

Citation of this paper

Livestock Production - The twenty first century's food revolution (Discussion paper on the donor community's role in securing a poverty oriented commercialization of livestock production in the developing world)

Eyvind Kristensen, Carl Erik Schou Larsen, Niels C Kyvsgaard, Jørgen Madsen and Jørgen Henriksen*

Department of Animal Science and Animal Health
The Royal Veterinary and Agricultural University, Copenhagen, Denmark
* TSA 1, Danida, The Danish Foreign Ministry
(An earlier version of this paper was presented at the workshop "How to involve farmers in the implementation of the Agricultural Sector Support Programmes (ASSP)", Tune Landboskole, Denmark, April 2 - 6, 2002)


This discussion paper attempts to present some of the future conditions for livestock production in developing countries and the options Donors as Danida has for supporting different strategies for development within this sector.

The global food market is undergoing major changes, especially in the developing world. Driven by an increasing level of income of a large number of city dwellers, the per capita consumption of food of animal origin has increased dramatically, especially in Asia. The International Food Policy Research Institute estimated that the global demand will double by 2020.

This paper is based on recent literature, and discuss possible consequences and challenges. One scenario is that the demand will be met by large scale industrialised units, another that small-scale producers will develop livestock production that can satisfy the demand and the markets. It is found that whereas technologies are readily available for industrialised production, development of a competitive smallholder-based livestock production, requires holistic and carefully focused interventions.

It is concluded, that a market-driven development in many countries can be the stepping stone required for small-scale farmers to enter into a cash economy. It is also concluded that a laissez faire livestock policy will lead to a skewed development that by-passes and neglects the commercial potential of the small holder sector and an opportunity for fighting rural poverty is missed.

Main findings are:

Industrialised large-scale livestock production is expanding due to economies of scale, vertical integration and high demand for the products. The industrialised production is often favoured by more or less hidden subsidies, but it entails environmental hazards and risk of enzootic diseases, it changes consumer preferences and tend to marginalize small-scale producers and have a negative impact on economic growth and employment in rural areas.

Therefore the governments, with the assistance of the donors, should consider to:

Donors like Danida, with policies for agriculture and livestock as well as objectives of support to poverty alleviation, are in principle in line with the findings, but it is perhaps less clear in actual initiatives, as stipulated in the present guidelines where the government is the central partner for the Danish assistance. In the future, it is important to focus more on the participation of the farming community and to facilitate agro-industrial development through market studies; business plans; education for the agro industry and feasibility studies for the livestock industry.

Key words: Development, donors, poverty, strategy

The dairy and meat revolution

The Global Food Outlook 2002

"Hungry man is angry man"
Dr. Satyenda Rao, Director, Indo Danish Project, Bangalore, India 1972.
(See also B Fagan: Floods, Famines and Emperors about the riots and lootings following the El Nino's in the 1980's)

The world population has passed 6 billion and is increasing with more than 200.000 persons per day and can be expected to double within the next forty years. The world resources of agricultural land are limited, the oceans resources of fish are limited, possibilities for expansion of cultivation or pastoral utilisation are almost exhausted, and yet - paradoxically - food prices in real terms have been dwindling (IFPRI 2000) during the previous century. Will this continue or will food prices increase - will it be possible to meet the food demand in a sustainable way - and which changes in agricultural production systems are necessary? IFPRI predicts (IFPRI 2001) that unless governments, international organisations and private firms increase investments in productivity  enhancing measures, food supply will not be able to keep pace with population income and growth at prevailing prices. 

Since Malthus (1766 - 1834) predicted that the human population would grow faster than the food production, this issue has given reason to many speculations. Indeed, since beginning of human history, securing of food has been one long story of innovations and adaptations: It took our ancestors a few million years to get used to life in the open savannahs instead of the forests; - develop from a life as scavengers and gatherers, to develop tools and become hunters and gatherers, and it took a few thousand years to learn to become farmers and herders. (Jensen 2001, Diamond 1998, Reader 1998, Douglas-Price 2000). From time to time throughout the history, food shortages have occurred due to population growth, wars, ecologic disasters, environmental degradation and mismanagement of natural resources. Each time four options have been available: - move to other areas - invent/adapt technologies -purchase/ import or give up and die!

Today, many people are trying to escape poverty by moving to other countries, but this strategy can only be a solution to a tiny fraction. The truth is that there are no longer any virgin land left to go to, to increase horizontal productivity, and there are only few unexplored resources left. The only real possibility left for increased food production seems to be through an increase in vertical or per unit land productivity.  Many will claim that technologies are ready - a truth with modifications - but even more will agree that implementation is facing numerous constraints and barriers. (See annex 2)

It is stated that there is enough food in the world today for all the 6 billions, but due to uneven distribution, 12 - 15 percent or 8-900 millions are, at least periodically, starving or malnourished. Malnutrition and starvation is linked to a combination of purchasing power and individual production capacity. The majority of rural poor have no purchasing power to compensate for decrease in production do to e.g. climate, pests, diseases, war, soil depletion, erosion, aids and other nature or man made catastrophes. No global food policy or strategies for future food security have - for good reasons - been made, and it seems that the global development is left to the forces of demand and supply.  Food security is normally a priority at national level. However, third world governments often don't have the resources, priorities and political freedom to favour the agriculture and livestock sector. The livestock sector is most disfavoured because it seldom generate export revenue.

The International Food Policy Research Institute (IFPRI) is an institute within the CGIAR system working with those problems. In the latest report '2020 Global Food Outlook' (IFPRI 2001) the institute presents both optimistic and pessimistic views and predictions and appeal to governments and international institutions to pay attention to the world food situation. In a previous report 'Livestock to 2020' (IFPRI 1999) the institute outlined the consequences that population growth, urbanisation and increasing incomes have had and is expected to have on demand for food, especially of livestock products. It also points to different scenarios depending on whether the demand will be met by industrialised systems or there will be opportunities for small-scale livestock production.

This paper attempts to present some of the future conditions for livestock production in developing countries and the options Danida - and the donor community at large- has for adjusting its policy within the livestock sector to the ongoing trends and possible future scenarios.

Food Demand, Consumption, Urbanisation and Increasing Income

The world demand for food is increasing not only due to more people, but also due to a change in consumption pattern as a result of increased income and urbanisation. The trend is, as evidenced especially in Asia, that consumption of foods of animal origin - meat, eggs and dairy products - per capita increased by 50 % between 1970 and 1990 and the demand is expected to double over the next twenty years (IFPRI 1999).

In Denmark, like in most other industrialised countries, we consume twice as much meat and only half as many potatoes per person as we did fifty years ago (Danmarks Statistik 2001), but for us, like for other western countries, the forecasts predicts that per capita consumption of livestock products will remain static or even decrease slightly.

Table 1 shows that consumption of livestock products per capita is 3 to 5 times higher in the industrialized than in the developing world, but that this difference is expected to be reduced over the next twenty years.

Table 1. Actual and Expected Annual Consumption in kg per Capita (IFPRI 1999)


Industrialised countries

Developing countries




















Milk and dairy products





Combined with the expected population growth, the increased per capita consumption will result in a doubling of the demand for livestock products. While the differences between the industrialised and developing world are expected to be narrowing, the gaps in per capita consumption between countries in the developing world are widening. This tendency is demonstrated in the following table 2, which compare consumption of meat and milk (milk and milk equivalents ) in 1983 with 1993. Whereas the average Sub-Saharan consumer has experienced a decline, the consumers in the remaining developing world enjoy an increase or have kept status quo.

Table 2. Per Capita Annual Consumption of Meat and Milk, kg/year













Other East Asia










Latin America










Sub-Saharan Africa





Source: IFPRI 1999

The world population of livestock has been increasing over the past twenty years (annex 3) and most of the increase has taken place in the developing countries where, in some cases, the numbers have reached a level beyond the carrying capacity.

Table 3. Number of Animals in 1999 in Percentage of the Number in 1980




































Source: FAO Production Yearbook 1999

The total livestock production in Europe and USA has increased due to a higher productivity whereas the higher production in the developing countries primarily is due to the increased number of animals.

Changes and consequences

Development Trends

The increasing demand for food of animal origin is expected to bring changes in both composition of livestock species and in the production systems. Different scenarios can be foreseen in most countries:

For pig- and poultry products, the consumers are likely to get used to food more uniform in appearance and taste than what the traditional smallholder produced, and in the long run even come to prefer the industrialised products (Olsen 2000). This could marginalize small holders to a role as subsistence producers or at least as producers without access to the attractive urban markets. This development is already visible not only in Asia, but also in some African countries which have neighbours with a more developed economy than their own (e.g. Malawi, Zambia, Rwanda).

For the ruminants - cattle, sheep and goat - the picture will probably be more mixed. Industrialised large-scale milk production units might be seen in peri-urban areas, although logistic problems may constrain this development due to the high requirements for bulky feeding material and the quantities of manure to be removed from the production sites. However, the production system is prevalent in India and Pakistan. Feedlots for finishing beef and mutton are already well known, but mostly based on supply of animals from extensive production systems.

Development of semi-industrialised livestock production systems is well known from our part of the world and is taken as a natural consequence of technological developments. In a developing country, with poor infrastructure and areas with low economic activity, industrialisation has a high risk of creating a diversion of livestock production from being an important factor in the rural economy to an activity with limited development effect.

How will the small-scale producers be able to cope with this is the big issue in a development perspective? That smallholder livestock production can be competitive has been proved both in the dairy sector (operation Flood in India, the Milk vita in Bangladesh and the small-holder milk production in Kenya) and in the poultry sector (Bangladesh) while the pig sector still lacks behind. For further details on these issues, please refer to annex 1 and 2 

Box 1:  Poultry as a Tool against Poverty 

One of the most outstanding examples of successful poverty alleviation through intervention in the poultry sub-sector is from Bangladesh.

 The concept adopted can be described as an atomising of a modern poultry enterprise whereby the activities are spread out over a large number of producers. The target group are poor women and they are assisted by:

  • Organisation into producer groups,

  • Credit provided through small groups, following the Grameen Bank principles,

  • Production takes place through specialisation into egg-producers, chicken raisers, feed suppliers

  • Disease control through training of village vaccinators

  • Marketing with sale of eggs by women of the group

The projects are implemented in cooperation between NGO's (BRAC and Proshika) and Government (Directorate of Livestock Services, DLS). Support has been provided by a joint IFAD/Danida Smallholder Livestock Development Project (SLDP) since 1993 and is now in its second phase. The experience is also applied in the Danida funded Participatory Livestock Development Project (PLDP)

 The projects have achieved remarkably results both regarding coverage (1.25 million women in 1997 according to BRAC) and with regard to alleviation of poverty among the target group, which is selected among the extremely poor women. Impact studies have shown that the women have increased their share of the household income from 16 to 30 % during the project period and the households have at the same time more than doubled their consumption of eggs and milk.

 The provision of credit in combination with income creating activities explains to a large extend the success and is an example of the possibilities for organising and commercialisation of livestock production based on small-scale producers. Danida has as a result of this funded the establishment of a "Network for village poultry development" with participation from the Danish research institutions and universities to document further development and adapt the concept from Bangladesh for testing and implementation in other developing countries.

The expected high demand for meat, eggs and dairy products will provide opportunities as well as challenges for development of smallholder land/rural based systems in the coming decades.

A general experience has been that access to a market is a crucial precondition for development of livestock production, but also that provision of a market alone is not enough. To that end the small-holders are too disperse, unorganised and marginalized, and livestock production more complex and requiring longer term investments than other enterprises like e.g. crop production. The Iten experience mentioned in Box 2 below is an illustrative example underlining the importance of a holistic approach:

Box 2: The Milk cooler in Iten, Uasin Gishu District, Kenya

The milk supply zones to the Dairy factories in Rift Valley and Central Province were surveyed during the early eighties with the purpose of locating sites for placing milk coolers.

 In Eten, east of Eldoret, a small dairy cooperative society tried to organise collection and delivery of milk to the dairy factory in Eldoret. The quantities were small, the roads poor and cost of transport threatened to ruin the cooperative. The society made a good impression due to their democratic organisation and the good order in accounts. Unfortunately, the requirements for installation of a milk cooler was projections showing possibilities for collection of at least 5000 litre per day but the available information could only justify a figure of 3000 litre per day.


However, the preparation mission decided - out of sympathy with the society - to 'bend' the figures and somehow arrived at the magical figure of 5000 litres.


Two years after installation of the milk cooler, the society collected 13.000 litres per day and Eldoret dairy had to install extra storage capacity.

The big issue in a development perspective is how to stimulate and support the livestock sector, so that the growing demand for animal products will benefit also small-scale producers and lead to more equity and poverty reduction (Henriksen 1998).

Industrialised- Versus Traditional Land Based Livestock Production Systems

The traditional land based livestock production is, as the name indicates, based on utilization of existing natural resources in pastoral/ agro pastoral- or in integrated mixed crop-livestock systems. The majority of the producers are small scale (ILRI 2001a) and the importance of livestock to especially the poorer section of the rural population is well documented (LID 1999), as is the evidence of livestock production as a tool in rural development. (Linkages, Livestock and Livelihood 2001; Annex 2).

The industrialised production systems in developing countries started mainly with poultry- and later also with large-scale pig production units, often situated near the big cities and markets and partly vertically integrated (complete vertical integration would include provision of parents breeding stock and detail distribution system for end products )with feed suppliers on the input side and processing and marketing enterprises on the sales side. Other examples of large-scale livestock production are cattle ranches, for example in Latin America.

Industrialised production systems have the benefit of economies of scale and could, if judged from the development trend in South-East Asia, sooner or later be expected to dominate livestock production in the developing countries. Such structural changes have however - as we have seen also in our part of the world - a number of negative side effects like risk of pollution from high concentration of animals and risk of zoonotic diseases, often combined with antibiotic resistance.

Other negative aspects are more specific to the developing countries like the marginalizing of small-scale producers and the negative impact on rural employment.

On a global basis, IFPRI points to the risk of increasing prices on food grains in case the increased livestock production takes place in industrialised systems which is mainly based on feed grains as opposed to a smallholder based production which is more land based.  The industrialised system is, however, often preferred by politicians whom see it as a way of ensuring food supply to the cities, less problematic than investing in infrastructure and development of rural areas that eventually could supply the same.

"Starve the city dwellers and they riot; starve the peasants and they die. If you were a politician, which would you choose?"
Relief worker in the Sahel quoted in "Africa in Crisis" by Lloyd Timberlake.

Apart from the (urban) political stability, development of large-scale industrialised systems are more prestigious to decision makers and easier to manage than rural development projects. The advantages often enjoyed by industrialised systems are for example easy access to all infra structure, including credit, veterinary- and other services important to livestock production, liberal rules for use of antibiotics and growth additives in feedstuffs, few or no requirements for environmental protection measures, no fees on imported feedstuffs and favourable taxation. The result is supply to cities of food, which seem cheap, but only apparently, as many bills are left unpaid for future generations to pay. At the same time it is a development that will marginalize small-scale producers in remote areas, aggregating the gap between the 'have' and the 'have not' even further.

'Complementarities' and 'The Locomotive Effect'

The cases mentioned (Annex 1 and 2) of successful development of small-scale livestock enterprises are examples of interventions based on organisational development and where benefits of scale have been achieved in input supply, processing and marketing. Examples of 'complementarities' between large- and small-scale producers exist, where large-scale production systems have acted as 'locomotives' and been spearheading small-holder production are also found. In Denmark, for instance, it was the dairy technologies transferred from Holstein by the large farms that inspired Danish farmers to organise themselves and start cooperative dairies in order to use the same technologies and to compete (see also Just 2002). Another example is the role played by the large farm sector as supplier of cereal feed grain to the small- and medium size livestock producers.

Unfortunately, the same historical and political conditions are rarely found in the developing world of today.

However, there are also good stories. The cases below are intended as examples of such good stories, where development of small-scale milk production have been able to benefit from complementarities of scale. The roles played by the large-scale units have typically been development of production technologies, supply of breeding material, provision of capacity to build support institutions, supply industries and development of processing and marketing.

The Kenya Case

The agricultural development in Kenya is an example of locomotive effect of large scale farms. During the first half of the 20th century, large scale, privately owned commercial farms transferred, adapted and implemented modern agricultural technologies included exotic breeds and species. After the Second World War, the colonial government launched a number of agricultural development initiatives. The aim was to enable the smallholder (African) farmers to move from subsistence level into commercial food production. Agricultural Ordinances were passed, a number of development boards established and the so-called Swynnerton Plan (1953) implemented.  From then on, a two-pronged agricultural development took place. The large-scale sector provided in many ways not only technologies but also infrastructure (marketing facilities, dairy factories, slaughterhouses, storage facilities and distribution channels) to the dairy sector thereby providing the basis for the emerging small-scale sector. The period following independence could therefore witness that small-scale production in Kenya contributed an increasing percentage of the marketed agricultural products (Cone et al 1972).

A Government Farm as Locomotive

The Danish Farm in Muak Lek, Thailand (see Annex 1) played a role as a Mother Farm, first for a dairy colony comprising a number of small-scale farms and later as a model for dairy development in the country. It was the combination of a package of technologies and a concept of cooperative development based on small-scale farmers. As there was no commercial milk production in Thailand at the time of establishment, the Muak Lek farm paved the way by developing a suitable crossbred dairy cow, adapted forage production technologies, suitable housing, disease control measures and systems for milk collection, cooling, processing, packing and marketing. The farm also became the training ground for farmers to whom the idea of milk production was completely unknown and unfamiliar. Technology transfer at its best - and Thailand has today a well developed dairy industry.

A Private Farm as a Locomotive

The Kilifi Plantation (also known as 'the Wilson Dairy') is a large, privately owned, integrated dairy ranch and milk processing unit, situated north of Mombassa, Kenya. Following the liberalisation of the dairy industry in Kenya a number of private processors have started milk procurement from existing producers. At Kilifi, the ranch has started a milk collection scheme, up to now embracing 650 small-scale farmers from the coastal lowland and also seasonally from the traditional zebu herds in the semi-arid hinterland (Thorpe 2001.).

Apart from providing a secure outlet for the milk, the farm has supplied crossbred animals, private veterinary services and AI, and has facilitated delivery of concentrate feed and credit.

(In a way, this private initiative is a continuation of a capsized government project from the same area, - the Mariakani Milk Scheme that, in the mid sixties, was very successful and considered as the model for dairy development in that region. It came to an end during the mid seventies following a period of severe drought which reduced the number of cattle and after mismanagement of the scheme)

Examples of locomotive effects in pig- or poultry sector are less, as industrialised units here (as already mentioned) often are located close to consumer centres, suited for a vertical integration and not being land based. The experience also shows that utilization of complementarities do not take place unless supported by a focused policy and an enabling regulatory and institutional framework in place. To make use of complementarities and locomotive effects, the task for governments and donors would be to reveal eventual mutual interest between the livestock industry and the small-scale producers and to find ways and means of making cooperation operational.

It is concluded that:

Possible interventions

Global Level Issues

The effect of globalisation and the market reforms has so far mainly been to the benefit of countries with a stronger economy and - for a multiply of reasons - less to the Sub-Saharan Africa (IFPRI 2000 and CDR 2000). In spite of that, only few would wish for a return to a pre-reform situation.

Currently, negotiations in the WTO are ongoing and one of the major outstanding issues is removal of subsidies to agricultural export from developed countries. This has in principle been accepted, but without a definite time limit. Steps in the right direction have been taken but are too few, hesitant and far from sufficient as the former DG for IFPRI puts it (Andersen 2001). Agricultural subsidies in the western world amount to one billion US dollar per day or seven times as much as the total development assistance. Although EU has agreed on a plan for the termination of parts of it, e.g. sugar beets, it is very unlikely that it will stop in a foreseeable future.

High trade barriers on import from the developing world have been and are still problems seriously affecting the small-scale farmers and thereby the rural development. However, removal of subsidies and trade barriers would probably only have limited effect on the livestock sector. Raising concerns among consumers in the rich world regarding food safety, epidemic animal diseases and animal welfare has in recent years resulted in increased veterinary restrictions on trade with livestock products. These more 'technical barriers' to free trade will in practical continue to exclude small-scale producers in the third world from the world market even if the economic barriers are removed.

Another problem local producers occasionally has to compete with is dumping of surplus production. Export from developing countries to the very attractive markets in EU, Japan and USA remains a very complex process and even if the market were more open, lack of proper infrastructure in the developing countries would hamper the utilisation of this opportunity. Having said that the potential for development of regional markets for agricultural products must not be neglected in the "hot" and relevant discussion about access to the more distant and capital-intensive markets in the North.

National and Local Level Issues

At the national and at local levels, it is seems simpler to give advise on measures that could influence on the development. IFPRI 1999 conclude that due to the risk of a marginalizing of small-scale producers and the consequences as outlined above:"- it would be foolish for developing countries to adopt a laissez faire policy for livestock" and the same can be said about the donors attitudes to the livestock sector. In the IFPRI paper as well as in de Haan (2000) and in the 'Livestock in Poverty-Focused Development (LID 1999) a number of recommendations on possible interventions to modify the impact of industrialised livestock production and mitigate marginalizing small-scale producers are suggested. A slightly modified version follows below:

In the debate of poverty reduction or small-scale versus industrial production and in spite of a general consensus on the appropriateness of above recommendations, there seem to be a lack of visions regarding future structure and roles of the present small-scale producers. Many donors seem ready to protect and preserve the smallholders, but few have visions of the process required for ''transforming small-scale subsistence producers into commercial producers supplying a modern, demanding food market'!

In Europe the structural adjustment in the agricultural sector coincided with a rapid economic growth in other parts of the society, and the surplus labour was relatively easily absorbed by the production-, service- and information industry. In the developing world the economic and political driving forces towards a skewed and unbalanced industrialised scenario of livestock production are at places very strong. The speeds with which production patterns are changing are beyond the small-scale farmer's adaptation capacity. At the same time, those farmers have very limited political influence to secure that their livelihood is taken into consideration in government planning and legislation.  This pessimistic picture can, however, be turned into a scenario where a market driven, small holder focused development can be the stepping stone required for the small scale livestock producer to become commercial enterprises and act as locomotive for rural economic growth.

Conclusion and recommendations

It is concluded that there is a great potential for increased livestock production because of the rapidly growing demand and that the land based smallholder production systems are much neglected, despite its importance as a tool for economic growth and poverty alleviation in rural areas.

It is, therefore, recommended that livestock production, processing and marketing is promoted as an integrated part of an agriculture sector support programme, because of  1) the small holder livestock sectors proven record as an efficient tool for poverty alleviation and 2) the rapidly increasing demand for livestock products otherwise will be satisfied by industrialized production systems, that presents a risk to the environment, human health, and will prevent economic growth in rural areas.

This promotion of livestock production should take place through:

In general, donor support to agricultural development in the future should focus less on investments and capacity building in the public sector and much more on capacity building in the private sector and the farming community to facilitate the process of change:

Firstly, empower producer organisations to enable farmers to influence agricultural policies and to play a much needed active role in the dialogue with government for development of appropriate policies and strategies. Furthermore, small holders cannot as individuals profit from the urban market; they have to organize to take-up their important role in the livestock industry, and to play the private market for livestock products. Examples of support would be development of formal education programmes for young commercial farmers; promotion of farmer managed advisory services; and development/ strengthening of structures or institutions where the private agricultural sector and the government can meet as partners.

Secondly, facilitate agro-industrial development primarily in rural areas through market studies; business plans; education for the agro industry and feasibility studies for the livestock industry.

Annex 1. Trends in the Danish assistance to livestock development 1960 - 2000

The Start - the Time of the Large Farms
'The Large Farms'

The Danish support to agriculture in the developing countries has since the start in the early 1960's undergone changes and modifications in an attempt to find effective ways of giving support. The trend has been a move from transfer of modern technologies over project-based support to develop and adapt technologies to the present agricultural sector support programmes.

Animal husbandry, especially dairying, was high on the agenda already during initial stages - Denmark had a reputation as a dairy country and it was commonly accepted that dairy development would contribute to rural development and economic growth and at the same time improve human nutrition.

The preferred strategy was to follow a 'transfer of technology' approach by demonstrating methods and technologies. There was also a tendency to see the development assistance as an opportunity for promotion of Danish technologies and products and the Danish Agricultural Council and the Cattle Breeders Organisations started, and paid, the first of "the Large Farms" in Syria, Persia (Iran) Tunisia and Egypt which were seen as  'export windows' more than as development tools.  The idea was promotion of Danish cattle as well as for Danish agricultural equipment.

The Ministry of Foreign Affairs, through its 'Section for Technical Cooperation with Developing Countries' followed up with establishment of a large dairy farm in Thailand (Muak Lek) and in India (Bangalore) with three sub-stations (Munirabat, Kudigi and Dharwar) and one farm in Zambia. Support to the latter one was stopped again as the Zambia Government wanted it for commercial purposes and the Danish side wanted it for demonstration and training purposes. The farms established by the Agricultural Council were after a period handed over to the governments. In Thailand (Muak Lek) and in India the Danida supported farms became state farms and the Ministry of Foreign Affairs continued to provide technical assistance for longer periods. The role of the Danish specialists attached to the projects changed during the same period from being executive, more and more to a role as advisors and change agents/ facilitators only.

Along with the farms in India and Thailand followed a variety of other activities: Training of farmers, veterinary staff and animal husbandry advisers, milk recording schemes, artificial insemination, bull stations, cooperative development, and vaccine production. It was 'technology transfer and service delivery' projects.

Did the 'Large Farms' have an Impact?

- Thailand

The decision to start in Thailand was met with much scepticism for the first many years. Thai people could 'not digest lactose' and the climate was 'not suited' for milk production was some of the objections. The Thai farm in Muak Lek is probably the most successful in terms of impact. Not that it sold any Danish cattle or agricultural machinery, but it was the start of a very significant dairy development based on smallholder rural milk producers. Today, hundred-thousands of litres of milk are moved daily from rural to urban areas - and money the other way. The foundation was the technology and the concept.

- India

It was the FAO Freedom from Hunger Campaign in the early sixties which led to the agreement between the governments of India and Denmark to establish a centre for demonstration of Danish cattle and methods of milk production in Bangalore, Mysore State (now Karnataka) in the southern part of India. Indo-Danish Project started in 1964 and was later expanded with three sub-centres within the state of Karnataka. The cattle were purebred Red Dane and Jersey and the centres produced and sold bulls and semen. Crossbreeding was promoted through distribution of crossbreds and A.I. on local cattle in surrounding districts and through training of farmers and staff from the Animal Husbandry Department. The direct support to the Indo-Danish Project stopped in 1975 but Danida continued to support the Indian dairy sector with supply of cattle, bulls, semen and AI equipment up to the mid-eighties. The Red Dane breed did not get established in India. The Indians found it to heavy and preferred the Danish Jersey. The Indo-Danish Project and the following support to the dairy sector was riding on a wave created by the Operation Flood and thereby contributed to the fourfold increase in milk production in India during last part of the century.

The project was by that time, the second biggest single Danish project after the Congo Hospital. It got no good evaluation in Denmark when it closed in 1975 - partly because it was no longer considered political correct to support milk production, and partly because it was realised that the approach with establishment of large dairy farms, which later became state farms, was no longer considered relevant. The Indians are generally more positive and found that they learned from our approach: The focus on farmers and on the conditions in the village, - the pragmatic approach, no blueprints, but hands on and willingness to learn.

The Dairy Development Period
Milk Processing Facilities

During the seventies and into the eighties, much emphasis was on support to dairy development. In the cooperating countries, there was a demand for expansion/renovation of existing dairy plants as well as for establishing new ones. This was the State Loan period during which Denmark gave highly subsidised loans to governments which then on-lend the loans to the industry. These loans were tied to procurement of equipment in Denmark. Supply of turn-key dairies, dairy equipment, milk cooling and collection centres and training in dairy technology were major items for this program through the period. The strategy was provision of a market for milk.

The FAO Dairy Development and Training Centres

Also during the seventies, Danida started to fund a dairy development and training programme with FAO as implementing agency. This programme continued for more than twenty years from three regional centres covering English speaking countries in Africa, Asia and Spanish speaking in Latin America. The training in milk production, collection and processing conducted from these centres were focussing on small-scale production and also more and more on small-scale processing. The programme ended in 1990 when the support from Danida stopped. Many have regretted the stop of this activity - not least in Africa where stakeholders in the dairy sub-sector after the privatisation are missing an institution focusing on technologies adapted to the conditions of the emerging small scale private dairy industry. The training courses, the seminars, meetings and workshops covered all subjects from production, collection, cooling processing and marketing of dairy products and have played an important role in dairy development.

Did the Support to Dairy Development have an Impact?

The impact of dairy development is documented in a large number of cases. Excluding the more biased - to either side - it seem a general conclusion that dairy development in many cases do promote economic growth and is efficient as a tool for poverty reduction.

Box 3   The dairies in Kitale and Eldoret

In the period 1975 - 85, Danida supported renovation and expansion of the two dairy factories in Kitale and Eldoret, Kenya, with spray-drying and UHT -equipment and with milk collection and cooling Centres (MCC's). The increased capacities and the MCC's enabled an expansion in collected milk of extra 200.000 litre per day during the same period. (private communication 1986) With a milk price then of DKK 1.25 per litre, this extra collection is equivalent to a flow of cash from urban to rural areas of one million DKK every four days.

That milk production is also an opportunity for small-scale farmers is evidenced from examples in India and Bangladesh where 80 % of all milk is produced by farmers defined as small-scale, marginal and landless (Kurup 2001 and Milk Vita 2001).  Impact on employment is documented in a joint FAO and ILRI report (ILRI 2001a) concluding that for each one thousand litre of milk marketed, between 12 and 57 persons are employed in connection with collection, processing and marketing. Herd composition is changed as milk producers keep less male cattle (Kurup 2001) and gender roles is influenced, as the men takes more interest and share the work burden once it results in a cash income. And finally, from the nutritional point of view where it is perhaps not the poorer urban consumers that benefit, but many studies have shown that on an average, the smaller producers keep about one third of the milk for home consumption (the evening milk) (Shapiro, et al. 1998).

In Denmark, opinions about the dairy projects have been divided since the early seventies. Some questions the poverty alleviation aspect and others doubted the appropriateness in supporting large, centrally placed dairy factories and thereby freeze a structure established primarily with the purpose of supplying the cities with milk - and perhaps less with rural development as an objective. The practical experiences, however, left no doubt about an impact, and the potential in the dairy sector for transfer of cash from the better off urban population to the poor rural milk producers and the many people employed on the road from producer to consumer. (See Box 3).

From dairy to livestock

The 'Large Farm' era stopped in the mid-seventies. The attempts to transfer 'northern technologies' were replaced by attempts to support technology development and extension in concordance with the general understanding of how development was to be pursued. The 'Green Revolution' supported by the World Bank initiated Training and Visit extension approach, achieved considerable results in Asia. Livestock- and dairy development did not produce the same salient results for a variety of reasons and many donors lost interest in the livestock sub-sector.

During the eighties focus moved towards the farmers, the need for 'local participation' and for 'appropriate technologies' were realised as well as a need for a radical 'structural adjustment' to remedy the damages caused by the Government market monopoly era during the seventies.

Danida support to the Dairy Projects ceased during the early nineties. Support to the dairy sector in Nepal ceased by the end of 2000 and was the last of its kind. In the mid-eighties it was decided that in order to reach the small-, marginal and landless farmers with the Danida interventions, livestock projects should comprise livestock in general and not only cattle and milk production.

The Sector Support Programs

During the eighties, planning and policy issues came more and more in focus. A number of Dairy/Livestock Sector Reviews were carried out and projects shifted in nature. Agricultural projects became 'integrated' and livestock seen as an integrated part of the crop-livestock system. This was clearly an improvement and an adaptation to the actual conditions. The sector review analysis revealed the need for a more holistic approach to agricultural development in general. It became increasingly clear that a sustainable agricultural development required an 'enabling' environment with policies to support agriculture, with institutional framework developed, farmers organisations developed and with public sectors role limited to the policy level, including to regulatory and control measures.

The point of entry to most agricultural sector programs have been and are still ministries of agriculture, but as the agricultural sector is private by nature, the major share of the support are gradually moving towards the private sector in form of farmers organisation, financial services, marketing, etc.; facilitating the partnership between the farming community and the developing private sector within trade, processing, and marketing as well as in-put supply services. The balance in the Danish assistance is moving fromsupport to Government/ Ministry of Agriculture for the to develop the best policy for optimal economic growth, rural development and poverty alleviation to supporting the private stakeholders in the agricultural sector in their dialogue with Government on what kind of policies and support is requested by the sector. The Danida assistance should facilitate the institutional development and capacity building in the farming community and the private stakeholders necessary for establishing equal partnerships between the public and private sector without which it is difficult to imagine a sustainable growth of agriculture and livestock production.

Of actual livestock projects as such, only few (India) are left.  Activities in sector programmes specialised in poultry are supported or under preparation in Bangladesh, Vietnam, Kenya, Mozambique, Bolivia, Burkina and Benin. Otherwise, support to livestock sub-sectors are now included in other components in most agricultural sector programs, like private sector and farmers organisation components.

Annex 2. Livestock and the poor

Livestock as a Tool for Poverty Reduction

The general picture in most developing countries is that rural poor keep livestock, but it is the more well off urban population who are the consumers of livestock products. In this way the parties have a mutual interest in maintaining and developing the livestock sector, but it is not always on equal terms. It is an opportunity to the smallholders to keep the cities supplied with livestock products and earn cash income, but to the citizens, it might not matter so much where the food come from and if domestic production cannot quantitatively and qualitatively keep the market supplied, import is likely to cover the demand. This is far from unusual and the consequences are a skewed development, rural unemployment and poverty with migration to the cities for work and development of slum.

Livestock keeping is an important tool in rural development, especially for the smallholders and the poorer sections:

There is a clear correlation between level of income and consumption of livestock products in urban- as well as in rural areas. Many reports have established this, but also provided evidence that an increase in livestock production based on smallholder systems not only increase cash income but also household consumption of livestock products (LID 1999, Kurup 2001, ILRI 2001b). It is also documented that the increased rural income impact on the local purchasing power and general economic activity (Aneja 1997, Milk Vita 2001).

Despite the obvious poverty focus of livestock development, the sector has been loosing donor support and interest during the last decades (de Haan 2001). Is this a result of a change over from 'pure' livestock projects to 'integrated' as sub-components in rural- or watershed development projects? Or is it a result of negative experiences with livestock projects that have failed to deliver an impact? A negative - perhaps biased - attitude towards livestock development has existed some years.

Why some Livestock Projects have failed and what is required for success?

Reasons for success as well as for fiasco of livestock projects have been analysed by several agencies: The World Bank in an ADB Paper on Livestock (ADB 1991) and in a review of World Bank experience in 1993 (World Bank 1993) and also by the LID in Livestock in Poverty Focused Development (LID 1999)

There is a lot of consensus in the analysis and the thinking derived from the literature is also reflected in the Danida Sector Policies for Livestock (Danida 1997).

The reasons for failure can, when reversed, also be seen as preconditions for success. In the table 4 the findings from above papers have been combined and own experiences added:

Table 4. The reasons for failure and preconditions for success

Reasons for Failure

Conditions for Success

Technical and Service Delivery Projects

In-appropriate technologies and methods of dissemination insufficient.

Characteristics that make technologies relevant to the farmers are such as low risk – high profitability – easy reversibility and - divisibility. Dissemination needs skill and clear focus.

Lack of focus on the farmers’ conditions.

After 25 years of promotion of farmers first, bottom up and local participation, actual involvement of all stakeholders in the development process still has much to desire.

Single targeted, narrowly aiming – especially veterinary types of projects.

Integrated crop-livestock types of project have 50 % higher rate of success than single targeted projects. (ADB 1991)

Disregard of socio-economic conditions.

A multidisciplinary approach to planning and implementation.(the latter problematic when implementing agency is a line ministry)

Skewed strategy towards large ruminants and the formal sector.

The sum of the first four points would ensure that this does not happen.

Organisational type of Projects

The supported organisations continue to pursue in-appropriate aims and targets.

Clearly formulated log-frame, M and E measures. Frequent reviews and trigger mechanisms for release of funds

Top-down established and managed organisations.

It would be  better to  avoid such organisations. However, many of the official organisations and institutions, which you have to collaborate with, fall within this category. So a strategy for how to change attitudes and behaviours within the institution has to be developed.

The organisations supported do not have the capacity to implement.

Many log-frames simply jump over this issue by ‘assuming’ there will be technical, managerial and physical capacity available. This underlines the need for participatory planning and for use of planning calendars.

The staff lacks incentives to do the work.

Allowances, food baskets and the like are difficult issues with a lot of potential conflicts! Make sure staffs know what they have to do – that they are able to do it – and develop a team spirit. Demand driven activities instead of supply (donor) driven.

Poor management and or lack of will to change.

Sum up the above four points.

Institutional type of Projects

Historically Skewed Division of Power

Assistance through Danida Agricultural sector support programme according to the needs and priorities of the farmers and the sector instead of support to State agricultural sector programs. Include private sector support. Support innovative- and pilot projects.

Norms and traditions and/or government regulations retain in-appropriate systems.

Part of the rationale for sector support as opposed to project support is to be able to contravene and mitigate such problems

Weak governments yield to pressure from influence groups.

Support pilot projects and innovative approaches. (Examples: WYTEP and TANWA in India – agricultural extension for women and by women) 

Government policies contravene private initiative.

. Do not start – or stop – co-operation only with agencies/ministries/governments lacking visions.

The above conditions for successes are in no way new revolutions, the Danida guidelines and policies are more or less on line with what is stated. Attention is also drawn to the fact that the projects analysed were implemented before the structural adjustments and to regional differences where Latin America and Asia have higher rates of successes than Africa, underlining the importance of general economic growth, good governance and relevant agricultural policies.

The conclusion is that the development climate has changed, knowledge improved and interventions to promote integrated livestock development are in high demand.

Annex 3. World population of livestock 1980 - 1999

Table 5. World population of livestock 1980 – 1999

Livestock category and Regions


% of






Cattle, 1000 heads


































Buffaloes, 1000 heads


































Pigs, 1000 heads


































Sheep, 1000 heads


































Goats, 1000 heads


































Chicken, 1000000 heads


































Source: FAO Yearbook Vol.44 1990 and Vol.54 1999


ADB 1991 Factors affecting World Bank/IRDB Livestock Projects; Asia Development Bank Sector Paper on Livestock 1991.


Aneja R P 1997  The Asia Dairy Scene in Dairy India 1997.


British Society of Animal production 1993 Determinants of Success in Livestock Development Projects - A Review of World Bank Experiences; British Society of Animal Production 1993.


CDR 2000 Agricultural Policy in Africa After Adjustment. CDR Policy Paper 2000, E F Hansen, editor


Cone L, Winston and Lipscomb J F 1972 The History of Kenya Agriculture, University Press of Africa, Nairobi, Kenya


Danida 1997 Livestock Sector Policies.


Danmarks Statistik 2001


Diamond J 1998 Guns, Germs and Steel, Vintage Books 1998


Douglas-Price T 2000 Europe's First Farmers, University of Wiscouncin, Madison, Cambridge University Press 2000.


de Haan C 2000 A Global Initiative on the Delivery of Livestock Services to the Poor. A Concept Note by Haan, July 2000.


de Haan C 2001 Livestock Development. Implications for rural poverty, the environment and global food security. World Bank direction in development.


FAO Yearbook Vol.54 1999, Vol. 49 1995, Vol.44 1990, Vol. 39 1985 and Vol. 35 1980


Henriksen J 1998 Small scale dairying: opportunities and constraints. In: N J Kusina (editor) Integrated livestock/crop production systems in the smallholder Farming system in Zimbabwe. Proceeding of a workshop at the University of Zimbabwe, Harare, Zimbabwe, 13-16 January 1998. p. 8 - 18.


IFPRI 1999 Livestock to 2020, The next food revolution, IFPRI, FAO and ILRI, May 1999


IFPRI 2000 The Road Half Travelled. Agricultural Market Reform in Sub-Saharan Africa. Food Policy Report, IFPRI, October 2000.


IFPRI 2001 (Rosegrant M W, Paisner M S, Meijer S, Witcover J) 2020 Global Food Outlook, A 2020 Vision for Food, Agriculture, and the Environment. International Food Policy Research Institute, Washington, D.C.


ILRI 2001a Employment Generation Through Small-Scale Dairy Marketing and Processing: Experiences from Kenya, Bangladesh and Ghana. FAO and ILRI Report, July 2001


ILRI 2001b Smallholder Dairy Production and Marketing in Eastern and Southern Africa. Muriuki and Thorpe, MoA and RD and ILRI March 2001.


Jensen J 2001 Danmarks Oldtid, Gyldendal 2001


Just F 2002 Danish livestock production and poverty alleviation 1750-1950. Danida, IFAD and World Bank.


Kurup M P G 2001 Smallholder Dairy Production and Marketing: Constraints and Opportunities, Country Paper: India. M P G Kurup, February 2001


LEAD 1999 (de Haan C, Steinfeld H, Blackburn H) Livestock and the Environment, Finding the Balance. Report of a Study coordinated by the Food and Agricultural Organization of the United Nations, the United States Agency for International Development and the World Bank.Wren Media, Suffolk


LID 1999 Livestock in Development 1999: Livestock in Poverty-Focused Development


Linkages, Livestock and Livelihoods 2000 Proceedings of the First Interagency Meeting on Livestock Production and Health. Wye College, Kent, UK.


Milk Vita 2001 Milk Vita in Bangladesh. A case Study by B T Dugdill for a FAO Review. November 2000.


Olsen F Winther 2000 Agricultural Sector Support. Den Nye Verden, Nr.2, 2000.


Pindstrup-Andersen P  2002 Achieving the 2002 vision in the shadow of international terrorism. 2001 World Food Laureate Address.


Reader J 1998 Africa, A Biography of the Continent, Penquin Books,1998


Shapiro B I, Haider J, Gebrewold A, Misgina A and Alemayehu M 1998 Impact of market-oriented dairy production on women and children: Evidence from the Ethiopian highlands. Ethiopian Society of Animal Production (ESAP) Proceedings of the 6th Conference, 14-15 May 1998, p 28-46 Addis Ababa Ethiopia


Thorpe W 2001 The Kilifi Plantation Experience. Personal communication. ILRI, Nairobi.


World Bank 1993 Determinants of Success in Livestock Development Projects in Developing countries, a Review of World Bank Experience. British Society of Animal production. 1993.


Received 23 August 2003; Accepted 11 September 2003

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