More Milk in Tanzania (MoreMilkiT) meeting with ASAS Dairies Ltd

More Milk in Tanzania (MoreMilkiT) meeting with ASAS Dairies Ltd.
October 7th, Giraffe Ocean View Hotel
Objective of the meeting:
Explore the opportunity of linking Maziwa Zaidi producer groups in Morogoro Region with ASAS
Dairies Ltd of Iringa.
Participants:
Name
Roy Omulo
Edgar Twine
Julius Githinji
Emmanuel Mihayo
Agnes Assenga
Monata Lucas
Tom Sillayo
Adolf Mushi
Nissefori Mkwama
Organization
ASAS
ILRI
ILRI
Heifer
Heifer
Heifer
Faida MaLi
Faida MaLi
Faida MaLi
Background to the meeting
The meeting was held on the sidelines of the Maziwa Zaidi review and steering committee meeting
in Dar es Salaam. ASAS Dairies Ltd., located in Iringa Region, is the second largest milk processor in
Tanzania by market share. The company has an installed capacity of 50,000 liters per day but is
currently operating at 12,000 liters. The company is trying to expand its market share but is
constrained by the low supply of milk by producers within its catchment area.Therefore the
participation of ASAS in the Maziwa Zaidi meeting was an opportunity to discuss ways in which
ASAS and the Maziwa Zaidi MoreMilkiT project can work together to advance each other’s goals.
Opportunity
ASAS Dairies procures milk from producer groups;currently the company buys milk from 759
producers in Rungwe, 114 in Njombe and 117 from Isange in Busokelo District. The Procurement
and Dairy Business Development manager, Roy Omulo, has been impressed by the work being
undertaken by Maziwa Zaidi projects in Morogoro region, and sees it as an opportunity for his
company to enter into mutually beneficial business relationships with Maziwa Zaidi groups. ASAS
would like to increase its processing capacity utilization from the current 12,000 litres per day to at
least 20,000 litres per day with the ultimate goal of attaining full capacity utilization.
Benefits of working with ASAS

Reliable milk market for smallholder farmers even during periods of excess milk supply

ASAS Dairies supports organizational development of farmer groups through trainings,
sustainable capacity building linkages and provision of dairy business information and
services
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
ASAS uses different business models in dealing with producer groups. As such, ASAS and the
producers are able to choose the kind of model that would work best for them.
ASAS business models
1.
Farmers deliver milk to ASAS chilling plant in the target milk shed and are paid a price that
accounts for the transportation costs- farmers are responsible for milk transport to the
BMCC.
2.
In cases where the farmers add value by collecting, bulking and chilling the milk prior to
delivery to the ASAS MCC, the costs incurred are factored into the pricing.
3.
Farmers deliver milk at a designated point (collection stations) from where ASAS collects and
transports it to its chilling plant
4.
ASAS takes care of everything- transports from collection stations to the ASAS Bulk Milk
chilling center (BMCC); from experience, the company seeks to avoid this model for the
purposes of instilling responsibility among the P.Gs with the aim of creating business
oriented, self reliant producer groups.
ASAS chilling plant models
1.
ASAS installs the chilling plant and undertakes its management and costs
2.
ASAS procures the chilling plant, assists in its installation and mock trial during which
producer group members are trained to operate it and finally leaves the running of it to the
group
3.
ASAS links the group to a micro finance lender who then partners with the group in procuring
the plant. The plant is wholly owned and managed by the group
Action plan
In the meeting, it was agreed that Maziwa Zaidi and ASAS embark on concrete steps that would lead
to a business partnership between ASAS and some MoreMilkiT farmer groups in Morogoro. The
following action plan was agreed upon:
Steps
i. Project to provide ASAS with information on the number of producers
registered in Morogoro region, their production capacity, distance to the
nearest trading centres, available amenities of proposed chilling sites, road
type and condition both during dry and wet seasons and the prevailing market
prices. A milk shed map might go a long way. This will be done by Edgar and
Julius
ii. A follow-up meeting between ILRI, FaidaMaLi and ASAS to discuss ASAS’ views
from the information provided. This could be undertaken alongside a visit to
ASAS in Iringa.
iii. Letter of intent from ASAS (assuming a positive outcome from the information
provided and the Iringa meeting)
iv. Fact finding/validation by ASAS in the project area
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Timeline
By the end of
October-2014
November-2014
November-2014
By the 3rd week
of November2014
Appendix: An example of ASAS’ supply contract
MKATABA WA BIASHARA YA MAZIWA KATI YA MTANDAO WA WAFUGAJI
MSHIKAMANO NA KAMPUNI YA ASAS DAIRIES LTD
MASHARTI YA MKATABA
1. UHAI WA MKATABA
Mkataba huu utaanza tarehe…………………., na utadumu kwa muda wa mwaka mmoja (miezi 12)
ambapo miezi mitatu (3) itakuwa ya matazamio. Katika kipindi cha matazamio masharti yaliyoko
kwenye mkataba huu haywezi kubadilishwa labda kwa makubaliano ya pande zote mbili.
2. UBORA WA BIDHAA
Wauzaji/muuzaji atapaswakuuza maziwa ya ng’ombe yenye ubora safi na salama kwa mnunuzi
2.1. Vigezo vifuatavyo vitachunguzwa
i.
MILK FAT;
≥3.5%
ii.
SOLID NON FAT (snf)
≥3.5%
iii.
CORRECTED LACTOMETRE READING 28±1
iv.
TITRATABLE ACIDITY
≤ 0.16%
v.
TEMPERATURE
14±2
vi.
ALCOHOL TEST
NEGATIVE
vii.
CLOT-ON-BOLING-TEST
NEGATIVE
viii.
ANTIBIOTICS
NEGATIVE
2.2. Ikiwa kiwango cha asilimia ya fat kitashuka chini ya 3.2% kwa kila 0.1% iliyopungua
kutakuwa na punguzo la bei ya kununualia kwa shilingi…………………..
3. KIWANGO
Muuzaji/wauzaji watapaswa kumuuzia mnunuzi kiasi cha lita 1500 kila siku kwa siku zote za juma.
Kiwango hiki kinaweza kupungua au kongezeka kwa 10% bila taarifa rasmi, lakini iwapo kiwango
hiki kitaongezeza/kupungua kwa zaidi ya 10% taarifa rasmi kutoka kwa wauzaji/muuzaji ifikiswe
kwa mnunuzi kabla
4. UFIKISHAJI
Muuzaji/wauzaji watapaswa kufikisha maziwa kituoni kwa mnunuzi eneo la mjimwema mkabara na
shule ya viziwi kati ya saa moja asubuhi mpaka saa nne asubuhi (7:00am – 10:00am). Kama kuna
dharura yeyote itakayosababisha maziwa kuchelewa itolewe taarifa mapema kwa mnunuzi.
5. VIFAA VYA KUBEBEA (MILK CANS)
Mnunuzi atatoa milk cans za alminium ambazo zitatumika kusombea maziwa kutoka kwa wafugaji
mpaka kituoni kwake. Vifaa hivi vitabaki mali ya mnunuzi labda kuwe na makubaliano ya
kumrudishia gharama za vifaa hivyo, na makubaliano hayo yawe yametekelezeka. Upotevu au
uhalibifu wowote wa vifaa hivyo utagharamiwa na mtandao kwa kukatwa kwenye malipo gharama
zitakazoainishwa na kukubaliwa na pande zote mbili.
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